Sasfin : Taking Stock - Ford’s market cap tops $100 billion.

MARKET COMMENTARY

SOUTH AFRICAN MARKET COMMENTARY

Shares on the Johannesburg Stock Exchange were mixed yesterday as the All-Share index posted a 0.05% gain (now at 75,926 index points) and the blue-chip Top 40 index recorded a 0.03% loss. Financial stocks offered the biggest support, with the J212 index adding 0.95% on the day. In terms of individual price action, Old Mutual topped the Top 40's performances list as it added 3.95%. Miners, Northam and Impala Platinum were the worst blue-chip performers, shedding 3.74% and 3.02% respectively.

EUROPEAN MARKET COMMENTARY

European stocks closed lower on Thursday as global markets faltered following the latest U.S. inflation reading showing consumer prices rose once again in December. The pan-European Stoxx 600 hovered around the flatline during afternoon deals but closed lower by 0.2%. Household goods dropped 1.2% while autos gained 1.6%. On a monthly basis, CPI increased 0.5%. Economists expected the consumer price index to rise 0.4% in December, and 7% on a year-over-year basis, according to Dow Jones.

US MARKET COMMENTARY

U.S. stocks struggled on Thursday as a rebound in tech stocks faded, erasing gains from earlier this week. Tech stocks have been volatile to start 2022 as the Federal Reserve has signalled it will fight inflation aggressively this year, including rate hikes and potentially reducing its balance sheet. Strong earnings reports provided some positives for the market on Thursday. Delta Air Lines posted a beat on profit and revenue and reaffirmed full-year guidance, sending its shares up more than 2%. Elsewhere, Dow component Boeing rose nearly 3% following a Bloomberg News report that the company's 737 Max could resume service in China as soon as this month.

ASIAN MARKET COMMENTARY

Stocks in Japan and Hong Kong led losses in major Asia-Pacific markets this morning as the recent rally in U.S. stocks broke momentum with the Nasdaq snapping a three-day winning streak. South Korea's central bank raised its benchmark rate by 25 basis points to 1.25%, the highest since March 2020 and back to the rate it was at before the pandemic, according to Reuters. In other corporate news in the region, Citi is set to sell its retail businesses in four Southeast Asian countries - Indonesia, Malaysia, Thailand and Vietnam - to Singapore lender United Overseas Bank.

CURRENCY MARKET COMMENTARY

The rand slipped back early on Thursday, after strong gains a day earlier when the dollar retreated on U.S. inflation data. The rand was trading around R15.42 to the dollar at the end of the day, 0.72% weaker. The dollar headed for its largest weekly fall in eight months this morning as investors trimmed long positions and deemed, for now, that several U.S. rate hikes this year are fully priced in.

COMMODITIES MARKET COMMENTARY

Gold prices this morning was poised for their best weekly gain since last November, as investors await economic data that could provide clarity about U.S. Federal Reserve's tapering policy, while a weaker dollar and Treasury yields supported bullion. Meanwhile, oil prices eased for a second session today on growing concerns that Washington may soon act to cool prices, while movement controls in China to rein in a COVID-19 outbreak weighed on fuel demand.

LOCAL COMPANIES

Akani Properties

Akani Properties' R1.1 billion acquisition of the 23 000m² Nicolway Shopping Centre, as well as all properties in the Nicolway Precinct, may serve as the group's flagship given the centre's location in affluent Bryanston in Johannesburg's northern suburbs. The unlisted group says the purchase was made on behalf of its client, the Municipal Employees Pension Fund (MEPF), with the transaction approved by the Competition Tribunal in December. "The shopping centre is well located in terms of access and visibility on [William Nicol Drive] in the heart of Bryanston and it's strategically located in a LSM [high living standards measure] area surrounded by the Bryanston commercial node," Akani said in a statement. According to Akani Properties' managing director Zamani Letjane: "The acquisition of Nicolway demonstrates the group's optimistic view on the recovery of the SA economy from the effects of the Covid pandemic. "We are also seeing a shift from large shopping malls to small convenient shopping centres - a growing trend that presents growth opportunities for our property portfolio." Letjane adds that the Nicolway acquisition will greatly improve the company's balance sheet and income stream as the transaction is underpinned by quality tenants with long-dated leases.

INTERNATIONAL COMPANIES

Hyundai Motor Company (005380) -0.7%

Hyundai Heavy Industries' proposed takeover of rival Daewoo Shipbuilding & Marine Engineering Co Ltd to create the world's biggest shipbuilder was hit with an EU veto on Thursday on concerns that the deal would hurt competition. Hyundai, one of the largest shipbuilders in the world, announced the deal in 2019 in part to tackle overcapacity in the sector. The shipyard, which sought EU antitrust approval for the takeover in November 2019, said it may challenge the EU prohibition and criticised the regulator's focus on market shares. The South Korean industry ministry said it regretted the EU decision on a deal already cleared by China, Singapore and Kazakhstan. The European Commission said the deal would create the world's largest shipbuilder with a combined market share of at least 60%, leaving few alternative suppliers for customers.

Ford Motor Company (F) +2.3%

Ford Motor's market value topped $100 billion for the first time ever as the automaker's stock hit a new 52-week high Thursday. The company's shares jumped Thursday by as much as 5.7% to $25.87, hitting another 20-plus-year high, before closing at $25.02 a share, up 2.3%. Its market value dropped to $99.99 billion. The gains have been fuelled by Ford's plans to increase production of electric vehicles, including the Mustang Mach-E crossover and an upcoming electric version of its bestselling F-150 pickup that's due out this spring. Ford's now worth more than crosstown rival General Motors, at about $90 billion, as well as electric vehicle start-up Rivian Automotive, at $72 billion, which has failed to sustain gains following a blockbuster IPO in November.

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