| It is not just smokers and those who enjoy the occasional tipple who have been affected by the Covid-19 lockdown. Another vice has also been severely restricted, highlighted by Phumelela Gaming and Leisure yesterday: gambling. Pundits now have to go online and even there the choices are limited due to the impact of social distancing on horse racing and team sports. Phumelela was already under signifiant pressure and it says if the lockdown extends beyond the end of the month it could be tickets for the industry. Meanwhile, Life Healthcare has come through the first half of its financial year with what looks likely to be a solid performance. Still, it's not planning an interim dividend as the next six months is expected to be a lot tougher as a result of the coronavirus and measures it is taking in preparation for more affected patients. More on those stories in today's newsletter, along with updates from Steinhoff, South32 and Harmony Gold Mining. EOH has disposed of more non-core businesses as it sorts out its balance sheet and Exxaro is crying foul after Eskom declared force majeure on some of its coal contracts with the resources group. Ingham Analytics has recently issued two notes under the "The Market's Twin Towers" title followed up by "Earnings, Earnings, Earnings - What will you pay for them now?" and now "Whose telling fibs, equity or credit?". Written by top trader Andrew Kinsey, this note highlights the ineradicable links between the equity and credit markets not only through a show and tell manner but to highlight hybrid instruments and credit/equity products that sit at the nexus of the two markets. At a time of elevated volatility in global financial markets, with substantial dislocation between the valuations found in fixed income, equity and credit markets, this analysis is another must read for those trying to navigate raging rapids. You can access this latest report by following this link. Finally, the Ingham Analytics' note on South African banks entitled "A negative endowment" follows on from the interest rate cut last week, which has reinforced its bearish stance on bank shares. It says the repo rate could go down to 3% and the prime interest rate to 6.5%. In addition to other factors weighing down on banks' earnings and balance sheets it also examines why falling interest rates have what it terms a negative endowment effect on banks' capital and funding. Click here to read it. If you're venturing out, take care. Stephen Gunnion Managing Editor, InceConnect
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