EOH cuts salaries to ride out Covid-19

Sasol led the gainers as the JSE rose 2.7% yesterday, following the lead of other global markets on signs that the rate of new Covid-19 infections is beginning to slow in a number of European countries. Sasol's 53% rise pared losses in its share price for the year to 76%. News of oil production cuts were reported to have fuelled Sasol's rally.

EOH was another big gainer after it released half-year results and outlined the measures it was taking to deal with the fallout from the coronavirus, including executive pay cuts. These are on top of other cost-cutting and capital raising initiatives under a two-year turnaround strategy that's being driven by CEO Stephen van Coller, who will see his salary reduced by 25%.

Meanwhile, banks rose after the Reserve Bank's Prudential Authority clarified that they could go ahead with the payment of dividends they've already declared for the past year. But it's advised them to hold back on dividends this year due to the stress Covid-19 could add to their balance sheets.

Read on for more on those stories as well as updates from Imperial Logistics, Octodec Investments and Stefanutti Stocks.

In "The JSE All Share isn't alone, and neither is the rand" Ingham Analytics observes that the US dollar decline of the JSE All Share Index is dramatic, with Covid-19 the catalyst for driving down shares with unprecedented suddenness. The rand is also much weaker. International context on stocks, credit markets and currency are important, and this latest note provides helpful insight. Click here to read.

"The Market's Twin Towers" Part 2: Volatility follows on from "The Market's Twin Towers" Part 1: Liquidity (31 March 2020) and is a must read as a complement to that. Top trader Andrew Kinsey explains why volatility is often overquoted and substantially misunderstood and looks at the paradigm shift in markets between 12 February and 12 March 2020. Is this extreme volatility likely to persist? Click here to read.

Finally, if you're at home due to the lockdown and have time on your hands, please tune in to today's webcast at 11am as Andile Khumalo and award-winning financial journalist Bruce Whitfield discuss his new book The Ups!de of Down: How Chaos and Uncertainty Breed Opportunity in South Africa. Follow this link to register.

I hope you have a good day and please stay safe.

Stephen Gunnion

Managing Editor, InceConnect

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