Here’s what is happening in the markets:
- Despite its parent company, Barclays, planning to sell down its majority stake in the company to around 20%, Barclays Africa (Absa) says it will continue its business strategy as usual, with a goal to expand further into Africa. The group posted good results on Tuesday, pushing its share price up over 2% – Barclays, meanwhile, was down over 8% on its poor results.
- The drought in South Africa has killed around 5% of the country’s cattle and pork-breeding herds – fuelling food price hikes and ultimately hitting jobs. Chicken prices need to be hiked by as much as R7 to sustain the industry, while beef and lamb prices could jump by as much as 12% and 14%. As many as 650,000 cattle have perished in the extreme weather – and 20,000 jobs are at risk.
- SARS has joined the presidency and the Hawks in an attempt to quell speculation and turbulence around an investigation into a “rogue unit” which was allegedly set up under Finance Minister Pravin Gordhan’s watch. The revenue service defended the Hawks investigation, and distanced its leader – Tom Monyane – from the process, saying it started before he was even appointed.
- South Africa’s rand extended its recovery for a second day after President Jacob Zuma said he supported Finance Minister Pravin Gordhan, helping the currency shrug off data showing the economy was slowing. The rand is trading at R15.59 to the dollar, R21.78 to the pound and R16.94 to the euro.
- In global markets Asian shares rallied to two-month highs on Wednesday as overnight gains in oil prices and a swath of positive economic data from Australia to the United States calmed fears of a global economic slowdown. Oil prices dropped on Wednesday in the wake of industry data that showed a huge build in US crude stockpiles.
In other news: The National Union of Metalworkers of SA (Numsa) says that the 9.4% hike in electricity tariffs granted to Eskom could lead to as many as 40,000 job losses, as predicted by the Chamber of Mines. The group said businesses were already strapped for cash and cutting jobs, and the new fee hike would add even more pressure.