Exxon beats on EPS, but earnings hit by Middle East disruptions and weaker downstream performance

Market Performance

South African Market Summary

South African equities advanced on Thursday, with the All Share index rising 1.15% to 115,180.53 points and the Top 40 gaining 1.16% to 107,229.42 points, supported by improved risk sentiment. Producer inflation accelerated to 2.3% year-on-year in March, signalling early pipeline pressures. The country posted a trade surplus of R31.87 billion, while National Treasury reported a budget deficit of R45.61 billion, underscoring fiscal strain. Moody's relinquished its local regulatory licence to focus on cross-border coverage. Cyril Ramaphosa confirmed municipal elections for 4 November. Local markets were closed on Friday for a public holiday, with prices reflecting Thursday, 30 April’s session.

 European Market Summary

London’s FTSE 100 closed marginally lower on Friday, pressured by declines in heavyweight energy names and AstraZeneca, which fell 3.1% after a U.S. Food and Drug Administration panel rejected a key oncology treatment. NatWest dropped 3.4% despite a 12% increase in first-quarter profit, as non-interest income missed expectations. Trading volumes were subdued ahead of a UK public holiday, with most European markets closed, limiting liquidity. Despite this, LSEG I/B/E/S data indicates improving earnings momentum, with STOXX 600 companies expected to deliver 3.8% year-on-year growth excluding energy, supported by strong performance from energy majors and a broad beat rate.

US Market Summary

U.S. equities advanced on Friday, with the S&P 500 and Nasdaq Composite closing at record highs, supported by robust earnings and softer crude prices, while the Dow Jones Industrial Average edged lower. Both indices posted a sixth consecutive weekly gain, their longest streak since October 2024. Earnings momentum remains strong, with LSEG data showing 83% of companies beating EPS estimates. However, Institute for Supply Management data indicated rising inflation pressures, with prices paid at a four-year high. As markets enter a seasonally weaker period, positioning remains sensitive to inflation and AI-driven capex returns.

 Asian Market Summary

South Korean equities advanced on Monday, with the KOSPI reaching a fresh record following strong April gains, as investors balanced resilient domestic data against geopolitical tensions involving the U.S. and Iran. Manufacturing momentum strengthened, with the Purchasing Managers' Index rising to 53.6, its highest level since February 2022, driven by robust semiconductor demand. Policy expectations shifted more hawkish, with the Bank of Korea signalling a potential pivot towards rate hikes as growth holds above 2% and inflation trends above 2.2%. The outlook reflects a transition from accommodative policy towards normalisation amid sustained industrial strength.

Commodity Market Summary

Gold prices edged lower on Monday in subdued trading, pressured by persistent inflation concerns that continue to cloud the U.S. monetary policy outlook. In contrast, oil prices eased modestly but remained supported above $100 per barrel, reflecting ongoing geopolitical risk. Comments from Donald Trump on efforts to reopen shipping routes in the Strait of Hormuz provided limited relief, although the absence of a U.S.-Iran agreement continues to constrain supply flows. OPEC+ confirmed a further 188,000 bpd output increase for June, marking a third consecutive rise; however, disruptions linked to the conflict suggest much of the additional supply may remain unrealised in the near term.

Currency Market Summary

The South African rand strengthened on Thursday as investors assessed domestic data for signals on economic momentum, supporting near-term currency resilience. The Japanese yen stabilised after recent volatility, with suspected intervention by the Bank of Japan underpinning gains, although questions remain over the durability of unilateral support. The U.S. dollar index held broadly flat, reflecting cautious positioning amid geopolitical uncertainty. The euro edged higher following efforts by Friedrich Merz to ease tensions with the U.S. over trade policy. Comments from Donald Trump regarding shipping access in the Strait of Hormuz added to market sensitivity, keeping FX markets range-bound.

Domestic Company News

Glencore plc (GLN) +2.22%

Glencore plc (GLN) reported first-quarter 2026 production broadly in line with expectations, with full-year guidance unchanged despite cost pressures linked to Middle East-related supply disruptions. Copper output increased 19% to 199.6kt, supported by stronger grades in Africa and Antamina, while cobalt (-39%), zinc (-17%) and nickel (-9%) declined due to operational and structural factors, including mine closures and quota constraints in the DRC. Energy coal production was stable (-2%), while steelmaking coal fell 22% on weather and operational sequencing. Management expects higher commodity prices, notably copper, zinc and coal, to offset rising diesel and acid input costs, supporting margin expansion. Marketing EBIT is trending above the upper end of the $2.3–$3.5bn long-term range.

Santova Limited (SNV) -1.69%

Santova Limited (SNV) expects a moderation in earnings for the year ended 28 February 2026, with EPS guided between 102.56c and 108.32c (down 11.1% to 6.1% year-on-year) and HEPS between 103.82c and 109.59c (down 9.9% to 4.9%). The anticipated decline reflects a softer operational performance relative to the prior year’s elevated base. The trading statement remains unaudited, with final results still subject to completion. Additionally, the company flagged that UK subsidiaries, including Seabourne Group and related entities, have published statutory financials, signalling transparency but potentially highlighting regional performance dynamics. The update points to near-term earnings pressure, although the magnitude remains relatively contained.

MC Mining Limited (MCZ) +12.99%

MC Mining Limited (MCZ) reported solid progress in Q3 FY2026, with development of the Makhado hard coking coal project advancing towards commissioning in May 2026, positioning it as South Africa’s largest HCC operation with a 28-year life-of-mine. Operationally, safety performance improved, while Uitkomst Colliery was temporarily suspended from 1 March to evaluate strategic options, including potential partnerships. Thermal coal prices strengthened to US$99/t, with premium HCC at US$231/t, supporting the project’s economics. Liquidity improved, with available cash and facilities rising to US$5.4 million, alongside continued IDC debt repayments. Kinetic Development Group increased its stake to 51% following cumulative funding, reinforcing balance sheet support and execution visibility.

Global Company News

 Exxon Mobil Corporation (XOM) -1.02%

Exxon Mobil Corporation reported first-quarter adjusted EPS of $1.16, ahead of LSEG consensus of $1.00, supported by strong output in Guyana and the Permian Basin. However, net income fell to $4.2 billion, its lowest level since Q1 2021, reflecting significant disruption from Middle East supply constraints. Production declined sequentially to 4.59mboe/d amid Strait of Hormuz disruptions, with downside risk should outages persist. While upstream earnings remained resilient, downstream reported a loss, impacted by timing effects and undelivered cargoes. Management highlighted continued volatility but reaffirmed its strategy, with higher oil prices and portfolio strength expected to support medium-term earnings normalisation.

Chevron Corporation (CVX) -1.39%

Chevron Corporation reported first-quarter adjusted EPS of $1.41, well above LSEG consensus of $0.95, supported by elevated oil prices and resilient upstream performance. Upstream earnings rose 4% year-on-year to $3.9 billion, driven by stronger pricing, although net income declined to $2.2 billion, reflecting derivative-related timing effects. Downstream operations swung to a loss, highlighting margin pressure in refining. Production eased to 3.86mboe/d due to downtime at Tengiz, while free cash flow turned negative. Limited Middle East exposure (<5%) mitigates geopolitical risk, with management reiterating confidence in long-term cash flow growth despite near-term volatility.

 Click here for the daily moves of shares, indices and currencies