Steinhoff results and MTN court ruling in the spotlight on Tuesday

With the JSE set for a slow start on Tuesday, investors will pay close attention to long-awaited news from both embattled retailer Steinhoff International and mobile operator MTN.

Steinhoff, which said it had uncovered “accounting irregularities” in late 2017, is finally due to report its restated 2017 financial results. At the same time, a ruling is expected in MTN’s court tussle with Nigeria’s attorney-general, which wants $2bn (R29bn) in back taxes from the mobile operator.

Meanwhile, the JSE could get off to a mixed start on Tuesday as Asian markets edge slightly higher following heavy losses in the previous session on concerns about the trade dispute between the world’s two biggest economies.

The Shanghai Composite index, which lost 5.6% on Monday, was 0.3% up while Hong Kong’s Hang Seng Index added 0.2%. Australia’s main index also rose 0.2%, while Korea’s Kospi fell 1%.

The prior day’s losses were sparked by tweets from US President Donald Trump, who threatened to raise tariffs on $200bn of Chinese imports from 10% to 25% as trade talks were progressing “too slowly”. Markets were keeping a wary eye on trade developments on Tuesday, with the hope that the US and China will reach an agreement by Friday.

Locally, investors could trade with caution ahead of SA’s national election on Wednesday, a holiday. Some analysts say a strong win for the ruling ANC could boost local stocks.

While no major data is due in SA on Tuesday, the EU is scheduled to publish economic projections and the US will publish job-openings numbers.

Earlier, Australia released retail sales data for March that beat expectations. Nominal retail sales grew 0.3% month on month in March, “above consensus and our forecast”, Barclays Research said. 

But department store sales went backwards in March compared to both the prior month and same period a year before. Woolworths owns struggling department store chain David Jones in that market.

On the JSE, African Equity Empowerment Investments (AEEI) is due to publish interim results on Tuesday morning after several delays.

AEEI said last week its headline earnings per share in the six months to end-February rose 27%-47%. Normalised headline earnings per share more than doubled.

The rand, which reached a low of R14.57/$ overnight, was slightly stronger against the dollar and flat against other major currencies on Tuesday morning. It was at R14.41/$, R18.92/£, and R16.16/€.

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