JSE likely to follow Asian markets lower on Tuesday

The busy week for JSE-listed companies continues on Tuesday, with retailers Shoprite and Cashbuild, miner Assore and construction group Wilson Bayly Holmes-Ovcon (WBHO) scheduled to release results.

Shoprite warned shareholders on January 29 that it expected to report on Tuesday that interim headline earnings per share (HEPS) for the 26 weeks to December 30 declined by about 30%.

Its Angolan outlets suffered from an 85% crash in the local currency. Excluding Angolan hyperinflation, the decline in HEPS was about 20%, Shoprite said.

In SA, Shoprite said it suffered from supply disruptions caused by teething problems with a new enterprise resource planning system and strikes.

Shoprite said 10,719 of the items it sells got cheaper over the year, indicating growth of its top line will not be impressive.

WBHO warned shareholders on February 12 that it expected HEPS for the first half of its 2019 financial year to be only about a tenth of the matching period.

Reasons for the plunge in profitability included losses from an Australian road contract. It had underestimated the physical construction works required when it bid for the contract, the trading statement said

Iron ore miner Assore said on February 14 that it expected to report an about 20% growth in interim HEPS on Tuesday.

Prices for iron and manganese ores were higher, while those for chrome ore and manganese alloys were lower. Revenues were further enhanced by a weakened exchange rate, with the average rand-dollar rate being 5% weaker than the first half of its 2018 financial year, Assore said.

Asian stocks took a breather on Tuesday morning, with Naspers’s main asset, Tencent, down 0.58% to HK$341.80 in Hong Kong and BHP down 1.71% to A$37.38.

Tokyo’s Nikkei 225 index was down 0.42%, and Hong Kong’s Hang Seng index was down 0.51%.

The rand was trading at R13.85/$, R15.74/€, and R18.19/£ at 6.25am.

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