Whole Sale Trade and Motor Sales Data for September to Boost the JSE Today
As markets open on the JSE this morning, expectations are for the markets to tack gains made yesterday and to continue to trade higher with the release of three sets of data by Statistics South Africa (Stats SA). Yesterday, the JSE closed 0.05 percent higher boosted by firmer retail sales performance for September according to data released by Stats SA. It was not surprising to see retail shares topping the list of winners on the JSE. As investors start trading today, they will be watching three sets of data to be released by stats SA together with other international market data. The sets of Data to be released by stats SA today are:
- Wholesale trade sales, September 2014
- Mining: Production and sales, September 2014
- Motor trade sales, September 2014
Markets have opened firmer in Asia and such positive sentiments will be expected to impact positively on early trade on the JSE. Let’s take a close look on what to expect from the various data to be published by Stats SA today.
Firstly, Motor trade sales data for September to be released today is expected to be better than the 1, 8% increase that was seen in August 2014 year-on-year. The highest annual growth rates for August were recorded for convenience store sales (7, 2%), workshop income (7, 0%) and fuel sales (4, 7%). Seasonally adjusted motor trade sales increased by 3, 2% in the three months ended August 2014 compared with the previous three months. Motor trade sales increased by 4, 1% in the three months ended August 2014 compared with the three months ended August 2013.
Secondly, there are expectations of a rebound in wholesale trade sales from its 2,2% decrease year-on-year in August 2014 will boost the markets. The poor performance of wholesale trade sales in August were partially impacted by labour unrest in manufacturing and will be expected to be rebound as the producer price index (PPI) for September has shown improvement. Wholesale trade sales increased by 6, 2% in the three months ended August 2014 compared with the three months ended August 2013. Solid, liquid and gaseous fuels and related products (7, 3% and contributing 1, 6 percentage points); and, food, beverages and tobacco (6, 6% and contributing 1, 1 percentage points).
On the other hand, mining production is expected to marginally improve in September compared to its 10.1% decrease year-on-year in August 2014. The largest negative growth rates were recorded for PGMs (-45, 0%), diamonds (-30, 2%) and ‘other’ non-metallic minerals (-24, 1%). The main contributors to the 10, 1% decrease were PGMs (contributing -11, 6 percentage points) and gold (contributing -1, 1 percentage points).
Resources have not been doing well on the global markets and this is expected to be revealed in the mining sales data to be released today. While mineral sales decreased by 5, 9% year-on-year in July 2014, there are expectations that data for September will be better. In August, eight of the eleven mineral groups and minerals reported negative growth rates and investors will be watching for improvements in this data.
Analyst’s expectations are that there will be significant improvement in both the wholesale trade sales and motor trade sales for September. Mining production and sales for September is also expected to show a rebound after production in the previous months were subdued due to strike actions in July.