| A significant cut in interest rates by the Reserve Bank did little to stem the losses on the JSE or ease pressure on the rand. The SARB slashed its repo by 100 basis points to 5.25%, taking the prime lending rate to 8.75%, in response to the global financial fallout that has been triggered by the Covid-19 pandemic. Banks led the fall yesterday, with Nedbank and Absa declining by 26%, FirstRand dropping 21% and Standard Bank shedding 17%. While the interest rate cut will provide a little support for consumers, it is a double-edged sword for banks which will see a decrease in interest income as a result. They have also come under significant pressure over the past couple of weeks due to the prospect of customers losing their income and battling to repay loans. Capitec may have been a latecomer, but its shares have caught up with the declines the rest of the sector have suffered. Following big falls on Wednesday and yesterday, the bank moved to reassure investors due to concern over its unsecured loan book. Another bank, Sasfin, says it has sufficient funding buffers in place to ride out the storm for the short to medium term. In its latest note "In the darkness of tumult a possible chink of light", Ingham Analytics explains what is behind flash crashes - and flash rallies - where prices make short but very extreme moves. It also addresses Sasol and the oil market and US credit markets and if this has impacted equity. Any idea what the adjusted price earnings ratio is now on the US markets following sharp falls in indices? Click here to find out. Meanwhile, Ingham Analytics has also issued a note authored by top trader Andrew Kinsey on the oil market, a timely analysis when Sasol is being rocked. Oil market turmoil coincides with extreme instability and sharp falls in world equity markets, precipitated by the spread of Covid-19 virus. Can Mohamed 'the crazy' Bin Salman and Vlad 'the mad' Putin hold out at these low oil prices? Who could blink first? Are US shale producers going to the wall? Can you trade the oil market for profit? Click here to find out. Also in your newsletter today, Amplats is rethinking its spending plans this year due to the cost of repairing its Waterval smelter, EOH expects to report much reduced losses when it releases interim results next month, and African Rainbow Capital has been supported by its investment in data network operator Rain. All the latest mergers and acquisitions news from DealMakers too. I hope the weekend provides some respite from the current volatility. Stay safe. Stephen Gunnion Managing Editor, InceConnect
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