South African stocks to focus on oil prices and Bidvest

23 Aug, 2004

Escalating oil prices are seen putting downward pressure on South African stocks this week, and results from diversified services group Bidvest will also be in focus, traders said.
International oil prices, already at record highs, are expected to breach the $50 level after US crude set a new record over $49 a barrel on Friday.
"That will be bad news for the economy as it will eventually push prices up, affect inflation and very soon petrol prices," said Barend Saayman, a trader at Thebe Securities in Johannesburg.
The all-share index gained 3.5 percent this week, largely due to a weaker rand, which was knocked down by the central bank's surprise half-a-percent rate cut last week.
The rand will be less prominent this week, said Kevin Barlow-Jones from Afrifocus Securities.
He picked petrochemical firm Sasol and diversified mining giant BHP Billiton as the most likely to benefit from rising oil prices.
Bidvest is expected to report an 11 percent increase in full-year headline earnings per share on Monday helped by the benefits of a recent take-over.
According to Reuters Estimates, eight analysts expected the group to post headline earnings per share of 531.75 cents from the previous period's 479 cents.
Bidvest bought auto retailer McCarthy Ltd during the year for around 1 billion rand ($151.9 million).
Food supermarket chain Shoprite, which announces its year-end results on Tuesday, is expected to post a 65 percent jump in headline earnings per share to 94.96 cents from last year's 57.5 cents.
Analysts said they would be watching progress in its operations outside South Africa.
South African retailers have been posting impressive results thanks to buoyant consumer demand due to lower interest rates, tax cuts and low inflation.
Results are also due from freight holding firm Unitrans on Monday, conglomerate Imperial Holdings on Wednesday and construction group Murray and Roberts on Thursday.

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