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Market Commentary
Market Commentary for Monday 18 June 2018

After a delayed open on our local bourse due to technical related issues, the week started the trading session in the red following weaker global markets. Fitch left South Africa’s key credit ratings at sub-investment grade (foreign currency BB , local currency BB - both long-term) as expected this weekend with a stable outlook. The market remained under pressure throughout the afternoon and finished lower by 0.73% at the close. The worst performer for the day was the banking sector, depreciating 2.87% by market close. Leading the downside were Standard Bank and RMH Holdings, falling by 3.52% and 3.04% respectively. Our gold mining sector bucked the trend and finished 1.55% higher, driven largely by Harmony which closed the day 5.15% stronger. On the company front, Liberty confirmed that it has been subject to illegal and unauthorised access to their IT infrastructure. An external party has illegally obtained data from Liberty and demanded payment. The share closed the day down by 4.03%. Shareholders were advised that Capitec Bank has made a non-binding offer to purchase Mercantile. In a cautionary announcement from Stellar Capital, shareholders are advised that Stellar Capital has received a number of unsolicited expressions of interest to acquire Amalgamated Electronic Corporation Limited (“Amecor”) and has decided to undertake a formal disposal process to dispose of its interest in Amecor. In results from PPC for the year ended 31 March 2018, group revenue increased by 7% to R10,3 billion, basic earnings per share was up 25% to 10 cents, headline earnings per share increased by 114% to 15 cents while also realising an impairment of R165 million. In results from Invicta for the year ended 31 March 2018, revenue came in at R9.6 billion, headline earning per share before specific tax provision was 464 cents, down 23%. The share closed the day down by 8.36%. It was a quiet day on the economic front. The trade gap in Japan increased sharply to JPY 578.3 billion in May of 2018 from JPY 204.4 billion a year earlier. The trade surplus in Italy narrowed sharply to EUR 2.94 billion in April of 2018 from EUR 3.60 billion a year earlier. The NAHB Housing Market Index in the United States fell to 68 in June of 2018 from 70 in May, lower than market expectations of 70. Total value traded for the day was R13.49bn.

Market Commentary
The Day Ahead for Tuesday 19 June 2018

Wall Street ended the day in negative territory on Monday with the Dow Jones Industrial Average and the S&P500 slipping 0.41% and 0.21% respectively, as president Trump retaliated with threats of further tariffs on Chinese goods. Eastern markets are trading in negative territory this morning with the Nikkei and the Hang Seng index currently lower by 1.48% and 2.33% respectively. Tencent is trading in the red by 2.24% whilst BHP Billiton has lost 0.90% this morning. The Australian ASX is trading marginally stronger by 0.13% thus far. Traders can expect a negative start to trading on our local bourse this morning.

News Articles
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Fin24.com | Upcoming awards shine light on 'small but thriving' e-commerce sector
6/20/2018 5:00:04 AM

While electronic commerce only makes up 2% of the overall retail sector in South Africa, it is growing faster than the traditional retail sector.

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Fin24.com | THE STEINHOFF SAGA: Part one - The making of a corporate giant
6/19/2018 10:55:24 PM

In a series of in-depth features, the University of Stellenbosch Business School sheds light on Steinhoff's remarkable growth – and spectacular collapse. This is Part One: from humble beginnings in Germany to a massive global holding company.

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Fin24.com | Mining Charter III explained: The nitty-gritty according to legal experts
6/19/2018 10:30:01 PM

While the latest version of the Mining Charter is an improvement, it introduces more onerous and stringent compliance obligations than the current charter, say attorneys well-versed in the mining sector.

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Fin24.com | SA retailers show growth despite digital disruption
6/19/2018 10:12:02 PM

SA's largest retailers saw stronger revenue and profit growth through the last quarter of 2017 and first quarter of 2018, despite lower retail sales growth during the first four months of this year.

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Fin24.com | Further blow for billionaire Wiese as Brait struggles with losses
6/19/2018 9:54:34 PM

Billionaire Christo Wiese has received more bad news as shares of the investment company in which he’s the biggest shareholder fell after the firm posted an annual loss.

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Fin24.com | UPDATE: No load shedding for Tuesday evening
6/19/2018 9:28:51 PM

Power utility Eskom has thanked customers for using electricity sparingly after it avoided rotational load shedding on Tuesday evening.

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Fin24.com | SARB may hike interest rate if weak rand boosts inflation
6/19/2018 9:07:48 PM

The rand’s plunge to the weakest in almost seven months against the dollar may necessitate interest-rate increases, central bank Deputy Governor Kuben Naidoo has said.

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Fin24.com | Merkel hits back as Trump doubles down on German crime figures
6/19/2018 7:29:46 PM

The German Chancellor responded to Trump’s repeat assertions that crime has risen in Germany as a result of her liberal stance on migration, citing 'encouraging' statistics that show the opposite to be true.

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Fin24.com | Eskom tables new 4.7% wage hike offer to avert strike
6/19/2018 7:10:23 PM

Unions say they will take the offer to their members, as 4.7% is "very far from what we wanted".

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Fin24.com | Harmony Gold $100m closer to paying off bridging loan for Moab Khotsong
6/19/2018 6:38:00 PM

Harmony Gold says it has paid off $100m (R1.4bn) of a bridging loan it raised to acquire Moab Khotsong mine.

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Fin24.com | Regional operations carry PPC despite 'challenging' SA conditions
6/19/2018 6:27:26 PM

A robust contribution from Zimbabwe and the rest of its African operations has seen cement producer PPC report a 7% growth in revenue.

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Fin24.com | Grindrod Shipping Holdings lists on JSE
6/19/2018 6:26:05 PM

Grindrod Shipping will be the first Singapore-based company to be listed on the JSE, and the first company to simultaneously list on both the Nasdaq and JSE.

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Fin24.com | Sasfin drops KPMG and Grant Thornton Joburg as auditors
6/19/2018 5:13:40 PM

The group announced it had appointed PricewaterhouseCoopers as its new auditor with immediate effect.

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Fin24.com | Saica to start disciplinary proceedings against former Eskom CFO Anoj Singh
6/19/2018 4:12:43 PM

Following a period of investigation, the South African Institute of Chartered Accountants has decided to issue charges of misconduct against the chartered accountant and former Eskom CFO Anoj Singh.

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Fin24.com | Grant Thornton Joburg CEO steps aside amid sexual harassment probe
6/19/2018 3:28:07 PM

The CEO of Grant Thornton Johannesburg has stepped aside pending the outcome of an investigation into sexual harassment allegations against him.

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Fin24.com | Eskom wage talks off to a bad start - union
6/19/2018 2:54:30 PM

Talks between Eskom and unions are off to bad start, with the power producer reneging on its earlier agreement to include “high-powered” members in its delegation

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Fin24.com | Apple dips billion-dollar toe into Netflix challenge
6/19/2018 1:43:54 PM

Apple isn’t known for the unique video content offered by Netflix, Walt Disney and Amazon.com, but it may have just taken the gloves off in a new fight.

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Fin24.com | KPMG's audit quality unacceptable, says UK regulator
6/19/2018 1:23:09 PM

KPMG’s audit work in the UK is of an unacceptable standard, says Britain’s accounting regulator, fueling calls to reform the industry.

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Fin24.com | Why Transnet board committee's Iqbal Sharma must be prosecuted - report
6/19/2018 12:51:43 PM

Iqbal Sharma, chairperson of the Transnet board's acquisitions and disposals committee had a conflict of interest in the tender to build 1 064 locomotives, according to a report by MNS Attorneys.

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Fin24.com | ECB will be patient in timing of first rate hike - Draghi
6/19/2018 11:35:31 AM

Mario Draghi has promised that the European Central Bank will take its time to lift interest rates, reinforcing the agreement by policy makers to keep borrowing costs unchanged.

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TON
Heads up: Tongaat Hulett FY18 results - Cheap, but beware further short-term headwinds
6/19/2018

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MEI
Heads up: Mediclinic FY18 results review
6/12/2018

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VOD
Heads up: Vodacom Limited - FY18 results
6/11/2018

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FBR
Heads up: Famous Brands FY18 result - Tough trading conditions
6/11/2018

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KST
Heads up: PSG Konsult - FY18 results
6/11/2018

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SPP
Heads up: Spar 1H18 results - Switzerland swings into profit
6/8/2018

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VKE
Heads up: Vukile FY18 results -Spain is core to the business
6/7/2018

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LHC
Heads up: Life Healthcare 1H18 results review
6/7/2018

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SRR
Heads up: STAR 1H18 results - Addressing investor concerns
6/6/2018

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PFG
Heads up: Pioneer Foods 1H18 results - Recovery underway, but still some way to go
6/1/2018

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Charts Indices Currencies Metals & Brent Oil Gainers & Losers
CHARTS
International Indices
Name Value Move
DJ Ind.  24,698.60   -288.87  -1.2%
DJ Trans  10,842.54   -207.31  -1.9%
NASDAQ  7,689.34   -57.68  -0.7%
NYSE S and P500 INDEX  2,756.65   -17.10  -0.6%
FTSE 100  7,603.85   -27.48  -0.4%
XETRA DAX INDEX  6,271.85   -81.89  -1.3%
DAX INDEX  12,690.14   -143.97  -1.1%
HONG KONG HANG SENG INDEX  29,468.15   -841.34  -2.8%
NIKKEI 225 INDEX  22,278.48   -401.85  -1.8%
Major JSE Indices*
Name Value Move
OVERALL  56253   -983.53  -1.7%
TOP 40  50020   -984.53  -1.9%
ALL GOLD  1072   7.06  0.7%
INDUSTRIAL  73240   -1,696.51  -2.3%
FINANCIAL  15698   -261.76  -1.6%
RESOURCES  40893   -503.00  -1.2%
Delay = 15 minutes
Currencies
Name Value Move
ZAR/ / AUD  10.13   -0.03 -0.3%
ZAR/ / CHF  13.80   0.10 0.7%
USD/ / EUR  1.16   0.00 0.2%
ZAR/ / EUR  15.90   -0.04 -0.3%
USD/ / GB  1.32   0.00 0.1%
ZAR/ / GBP  18.09   -0.05 -0.3%
YEN/ / ZAR  8.01   -0.09 -1.1%
JPY/ / USD  110.02   -0.54 -0.5%
ZAR/ / USD  13.72   -0.05 -0.4%
Precious Metals & Brent Oil
Name Value Move
Brent Oil  74.72   -0.72 -1.0%
Palladium  965.70   -18.00 -1.8%
Platinum  863.50   -20.60 -2.3%
Silver  16.35   -0.12 -0.7%
Gold  1,274.12   -4.31 -0.3%
Top 5 Gainers -- Delayed
Europa Metals Limited  100.0
Aveng Group Limited NP  33.3
SABLE PLATINUM LTD  31.9
Caxton CTP Publish Pri  19.2
Accentuate Limited  18.0
Top 5 Losers -- Delayed
Imbalie Beauty Limited  -50.0
Vunani Ltd  -45.1
Forbes & Manhatt Coal  -16.7
Coal of Africa Ltd  -14.3
Purple Group Ltd  -13.8

PRICES (15 minute delay)

STANLIB MSCI WORLD ETF : ETFWLD 3788  9 | CoreShares PrefTrax : PREFTX 816  -2 | Massmart Holdings Ltd : MSM 10911  -89 | Cargo Carriers Ltd : CRG 1600  0 | enX Group LImited : ENX 1314  36 |

SENS (15 minute delay)