BP braces for shareholder revolt, and private security regulator in hot water over R130 million contract

The rand was trading at R16.36 against the United States dollar on the morning of Thursday, 24 September.

South African stocks ended Wednesday in the red, with the All Share Index down 1.57% and the Top 40 Index down 1.70%.

This came after the Reserve Bank’s Monetary Policy Committee voted to hike South Africa’s interest rates by 25 basis points on Wednesday.

This decision brought the repo rate up to 7.25% and the prime lending rate to 10.75%.

Reserve Bank Governor Lesetja Kganyago explained that it was important for inflation to return to the 3% target, which the central bank now believes will occur only in late 2027.

Turning to Wall Street, US stocks fell sharply on Wednesday, as Treasury yields marched higher and rising oil prices reignited inflation and interest rate hike concerns.

The S&P 500 slipped 0.75%, the Nasdaq shed 1.13%, and the Dow Jones dropped 0.68%.

This came after the US 10-year Treasury Yield hit its highest level since July 2007, following a rise in the US Purchasing Managers’ Index.

Another rate hike is now widely expected from the Federal Reserve in October, with inflationary concerns looming large.

Asian shares were having a more mixed performance in early trade on Thursday, as the swings in the US bond market are being digested.

Japan’s Nikkei gained 1.3% in morning trading, boosted by chipmakers and ongoing interest in artificial intelligence.

In contrast, Hong Kong’s Hang Seng slipped 0.5% while the Shanghai Composite dropped 0.8%.

In the commodities markets, Brent Crude oil was up 0.22% to $102.36 per barrel, remaining stubbornly above the $100 mark. Gold also rose 0.16% to reach $4,293.91 per ounce.

On Thursday morning, the rand was trading at R16.36 against the US dollar, R18.63 against the euro, and R21.66 against the British pound.

Important finance and investing news

A perfect storm for the United States: The US’ benchmark Treasury yield jumped above 5.1%, its highest level since 2007, marking its biggest one-day rise in over a year. [Wall Street Journal]

BP bracing for a shareholder revolt: The oil giant is expecting severe shareholder backlash at its upcoming annual general meeting after its board made a controversial decision to block a climate resolution. [CNBC]

Private security regulator in hot water: The SIU conducted a search at PSIRA’s head office in Pretoria over concerns regarding a R130 million UIF training contract. [BusinessDay]

Meta’s three new smart glasses: Meta unveiled three smart glasses with built-in AI at its annual developer conference, having spent billions to develop new AI models. [New York Times]

Paramount wants Musk’s money: Paramount is seeking fresh sources of cash amid its acquisition of Warner Bros. Discovery. Its executives are reportedly considering asking Elon Musk to join a syndicate of equity investors in Paramount. [Semafor]