JSE likely to cheer Chinese stimulus package

The JSE is likely to receive a fillip on Monday from the stimulus package the Chinese government unveiled at the weekend.

The Shenzhen composite index jumped 5% and the Shanghai composite index gained more than 4% as Chinese stocks cheered the government’s plans to boost the economy which include major tax cuts and loan guarantees.

Good news for Naspers shareholders is its major asset, Tencent, rallied 2.7% to HK$289.60 ahead of the JSE’s opening.

The rand was trading at R14.38/$, R16.56/€ and R18.80/£ at 6.55am.

Residential building developer Calgro M3 and retailer Verimark are expected to release results on Monday.

Calgro said in a trading statement on October 18 it expected its interim headline earnings per share (HEPS) to be 3.11c, less than a tenth of the corresponding period’s 47.71c.

Basic earnings per share are expected to halve.

Problems during the six months to end-August included illegal occupations of the land it is developing at Scottsdene and Fleurhof.

The property developer said it suffered from “major electrification challenges” at Fleurhof, and “macro- and microeconomic uncertainty coupled with uncertainty pertaining to land expropriation”.

Verimark said on September 27 it expected to report on Monday it may have fallen into a headline loss per share for the six months to end-August of up to 0.13c, from HEPS of 1.03c in the matching period.

“Although Verimark’s revenue is only marginally down compared with the six months ended August 31 2017, the company incurred a loss before tax compared with a profit before tax in the comparative period. This is due to certain costs being incurred to improve revenue, which will only reflect financial benefits in future months,” the trading update said.

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