Simon Shares
- I'm recording Wednesday afternoon and the violence of the past week seems to be abating, certainly in Gauteng. It has been a horror week for our country and most importantly; look after yourself if you can somebody else as well and above all else, be kind.
- US CPI YoY 5.4%. Core YoY 4.5%. Both ahead of expectations.
- A very strong production update from Pan African (JSE code: PAN) and their 15ha blueberry farm.
- OPEC+ seems to have reached a compromise between Saudi Arabia and UAE that should see an OPEC+ deal possible.
- US earnings season has kicked off and is expected to be the best ever - and it needs to be with S&P500 and Nasdaq100 at all-time highs.
- Gold US$1,825.
- Lost in all the rioting is another two weeks of level 4 adjusted lockdown, albeit restaurants can seat customers.
Upcoming events;
- We're starting to see SENS announcements about the impact of the rioting. The worst-hit so far seems to be Cashbuild (JSE code: CSB), they have 36 stores directly impacted by rioting and looting and a further 33 stores closed as a precautionary measure.
- Ethekwini Region, according to its mayor, Mxolisi Kaunda. R1billion loss of stock has been affected & R15billion rand of damage to property and equipment.
- Fuel refinery Sapref declares force majeure and shuts the plant.
- Large parts of N3 remain closed and Durban harbour has thirteen ships waiting for entry (according to VesselFinder.com). To my memory of living in KZN and counting the ships waiting whenever I could, that's about as many as I've ever seen.
- These will resolve as the rioting quietens down, and evidence is that it peaked on Monday. Longer-term the impact is hard to tell. Certainly, thousands of small businesses are gone and with them jobs. The Rand has fallen to 14.66 after hitting 14.76 early on Wednesday after it was trading at 14.20 on Friday. The JSE is actually up some 3% so far for the week.
Riot insurance
So the answer here is fairly simple, South Africa has an SOE that covers riot insurance - South African Special Risks Insurance Association (Sasria).
They repeatedly have clean audits (financials are here).
Assets under management is a little over R8billion.
But they have reinsurance.
Pretty much any property insurance you have will include a line item for Sasria and it is very cheap.
For corporates, it is a larger cost every month and the question is are corporates 10% insured or have they done some self insuring.
