It only takes a little bit of positive news to make a big impact on investor sentiment, as was the case on Friday. Stock markets took heart from news that trial testing of a drug developed by US biopharmaceutical company Gilead Sciences had received positive results, boosting its share price and the broader market. So, after yet another volatile week, the JSE closed 1.8% higher, taking gains for the week to 2.3%.

Local news flow continued to be driven by corporate responses to Covid-19. Impala Platinum made the headlines after one of its executives was arrested for recalling workers after the Department of Mineral Resources and Energy relaxed the rules to allow mining companies to ramp up to 50% of previous production. It seems the lines of communication between the Mines Minister and his counterpart in policing aren't always open.

Meanwhile, Mediclinic says next year's earnings are likely to be impacted as it puts off all non-urgent elective surgery to strengthen its response to the coronavirus. Murray and Roberts and Hulamin also updated investors on how they are being affected by the pandemic.

More on those stories to follow, along with full-year results from food and agri group Zeder Investments and interims from financial services company Ecsponent.

The Ingham Analytics note on SA banks entitled "Covid-19 coup de grce for banks" was well-timed and a popular note for readers. Now, it has issued "A negative endowment", following on from the interest rate cut last week. Ingham Analytics has repeatedly warned about exposure to banking stocks in several notes and says the recent cuts in interest rates reinforces its bearish stance. In addition to other factors weighing on the banks, it also examines why falling interest rates have what it refers to as a negative endowment effect. Click here to read.

Ingham Analytics recently issued two notes under the "The Market's Twin Towers" title. This is now followed up by "Earnings, Earnings, Earnings - What will you pay for them now?" The note examines the prospects for corporate earnings. How far will earnings fall because of COVID-19? What would the market be prepared to pay for those earnings? Extensive US data is examined too. Click here to read.

Have a good week and stay safe.

Stephen Gunnion

Managing Editor, InceConnect

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