News in South Africa 27th November:
1. Black Friday shopping warning:
Long queues and crowds are a common feature of Black Friday as consumers hunt down the best deals — and health minister Zweli Mkhize has cautioned shoppers to be careful to avoid any chance of contracting Covid-19.
Mkhize said consumers should make sure their Black Friday shopping includes sanitising, social distancing and wearing face masks at all times.
This year, most big retailers came up with creative ways to mark Black Friday while avoiding where possible exposing customers to Covid-19. Some are running month-long promotions while others had their specials available only online.
A Mastercard study has revealed the rapid growth of online shopping, with 68% of South African consumers shopping more online than they did before the pandemic.
Historically, Black Friday is seen as the biggest shopping day on the calendar, with a growing list of South African retailers offering greatly reduced prices across most sectors.
Many businesses will look to this shopping period this year to try to recoup some of the losses incurred during lockdown, imposed by the government in late March, to slow the rate of Covid-19 infections.
Listed companies including the likes of Makro, Woolworths, Shoprite, and Mr Price have already pointed to a massive surge in online activity in 2020. Black Friday is likely to show a continuation of this trend.
Online retailers are also expected to offer a number of specials on ‘Cyber Monday’, which falls on 30 November in 2020.
Find a list of stores running Black Friday specials here.
2. Bitcoin drops by over 10%:
Bitcoin slid by more than $2,000 on Thursday in its biggest one-day drop in nearly three months.
The price of the world’s largest cryptocurrency had fallen by 11%, to $16,725, as of 8:45 a.m. GMT. The price is still up by about 21% this month and by 138% on the year. It hit a peak of $19,497 on Wednesday but did not break the record of $19,666 set in December 2017.
The price correction may also be a function of crypto traders moving larger volumes of bitcoin to exchanges — where they can be more easily sold at a better price — when the token approached $20,000.
“It feels more and more like we’re hitting a Bitcoin tipping point,” said John Kramer, a trader at the crypto trading firm GSR. “In fact, a cooldown is to be expected. But with more well-known fund managers and institutions re-examining their Bitcoin theses every day, it’s getting harder to not take the asset more seriously.”
Other digital coins tumbled alongside Bitcoin. Ethereum fell by more than 13%, to about $491, and Ripple’s XRP fell by 20%, to $0.49.
3. SAA bail out not Tito’s choice:
Finance Minister Tito Mboweni found himself in the crosshairs of parliamentarians as he once again found himself defending the allocation of R10.5 billion to the business rescue process of troubled national airline, South African Airways.
Faced by a barrage of questions from opposition party members, he insisted during the virtual plenary on Thursday that the allocation to SAA in the medium-term budget policy statement (MTBPS) was not a “bailout” but sought to facilitate the business rescue process at the airline.
“This is not a bailout because the allocation is made for the business rescue practitioner’s plan. It’s not for the whole of SAA. If you check carefully, the sub-allocations show provision for retrenchment costs, un-flown tickets, commitments and so on,” he said.
“National Treasury and COGTA should conduct assessments of service delivery standards on the ground where it relates to changes in allocations to assist SAA. Poor and vulnerable South Africans could be and may be affected. This should include measures to mitigate negative impact,” said Select Committee on Appropriations chair Dikeledi Mahlangu.
A number of departments lost out on some funding so that SAA could get R10.5 billion, including the Department of Basic Education and The Department of Defense and Military Veterans.
Regarding continued assistance to state-owned entities, which he has vocally opposed on other platforms, Mboweni simply said: “The responsibility of the minister of finance is to implement Cabinet decisions. It’s not my own private decision.”
4. FirstRand profits could drop by 25%:
FirstRand warned that its half-year profits would likely be up to 25% lower, but said that its revenues had been higher than expected, and that debt repayments have recovered to better-than-expected levels.
Shareholders have been advised that IFRS headline earnings per share (HEPS), earnings per share (EPS) and normalised earnings per share for the six months to 31 December 2020 (current period) are expected to decline by between 20% and 25% from the reported 2019 comparatives of 249.4 cents, 249.3 cents and 249.7 cents, respectively.
Whilst this performance remains in line with guidance, the earnings trend for the four months from 1 July 2020 to 31 October 2020 is reflecting a better than anticipated rebound.
In terms of revenue, period-on-period (October 2019 to October 2020) net interest income (NII) increased 2%
whilst non-interest revenue (NIR) was down marginally.
NII remained resilient despite muted growth in advances, pressure on margins, and the impact of endowment and excess liquidity levels, however, the deposit franchise continued to show good growth through the period (+18%).
Retail and commercial deposits grew 13% and 20%, respectively, with large corporate deposits increasing 17%.
The UK deposit franchise saw strong growth of 25%.
5. Western Cape infections still rising:
The Western Cape Disaster Management Joint Operation Centre is beefing up enforcement of COVID-19 regulations as infections continue to rise.
The move to stronger enforcement comes as a result of the growing number of cases and hospitalisations in the province.
Over the last week, there has been a 52.1% jump in new cases, primarily in the Garden Route and the Cape Metro regions.
Spokesperson for the Western Cape Environmental Affairs Department James-Brent Styan: “This enforcement effort will be carried out in a coordinated approach across the province, led by the South African Police Service. We’ll be doing inspections of places of work, entertainment, public gatherings.”
He said that there would also be inspections at isolation and quarantine sites.
All information sourced from articles posted by: BusinessTech, Business Insider, TimesLive, Market Insider, Fin24, and EWN.
