Oil below US$ 80, the first time this year.
Chinese covid-19 cases hitting new records, by a long way.
This has real implications (bad ones) for the global economy as the second largest is going to be struggling in 2023.
Chinese covid cases since the start of the pandemic
It feels really bad but the JSE has had a fair year with sen decent winners as the two images below show.
JSE Top40 stocks year-to-date. (winners)
JSE Top40 stocks year-to-date. (losers)
Binance buys FTX.
No, they walk away.
FTX goes bust.
Keep your coins in a hardware wallet, not on the blockchain unless you trading it. I use a Ledger Nano S Plus.
What's the future for crypto with another exchange hitting the wall?
So you bought a stock and it's done good and you're making money, maybe even lots of it.
FAANGs, a mixed bag with Meta (NASDAQ code: META) the biggest loser.
Is it worth buying or what of the other FAANGs?
Apple (NASDAQ share code: AAPL) and Amazon (NASDAQ code: AMZN) would be my picks. Why buy the losers?
The Fini15 (JSE code: STXFIN*) is the only green index so far in 2022 and the strongest bank YTD? Absa (JSE code: ABG).
Simon takes us through the journey of finding the strongest sectors and then the strongest shares to find a trade where the money is.
My lazy system has triggered buys on both S&P500 and Nasdaq. A close above last night's close and I'll be long pic.twitter.com/8HAisLdPZr
— Simon Brown (@SimonPB) October 26, 2022
"working capital requirements are especially acute"
"financial results for the six months period ending 31 December 2022, to be at least 100% down"
This is not South Africa at all, it's Australia and the US. We've seen Wilson Bayly (JSE code: WBO) walk away from their Australian operations.
Low margins and bankers not keen on bonding projects are going to crunch this industry globally. I would suggest Aveng (JSE code: AEG) is not immune either.
The only time this industry really made money was in the run-up to the world cup, and they were colluding to get operating margins of +5%. So really this is a bust industry.
That all said, decent results from Calgro M3 (JSE code: CGR) while we wait for Balwin (JSE code: BWN).
Here the UK 5, 10 & 30 year bonds for September .(with correct carts) . Just September pic.twitter.com/hMj5yP65bC
— Simon Brown (@SimonPB) September 28, 2022
The US$ Index (code: DXY) is at twenty-year highs and within a few percent taking out the highs from the early 2000s and heading back to levels last seen in the mid-1980s.
The reasons are simple and two-fold;
Importantly this is hitting every currency in the world.
Has earnings implications for US companies selling products offshore as those profits are now lower due to US strength.
When does the strength stop?
What to do?
The tables have turned. Emerging markets are much more resilient against the US Dollar than the rest of the G10. Year-to-date, the Dollar has risen a stunning 15% against the G10 (black), but only 5% against emerging markets (blue). EM is the new standard bearer for stability... pic.twitter.com/ToaQvQB9DS
— Robin Brooks (@RobinBrooksIIF) September 27, 2022
The problem is getting back to target.
Rate increases still coming, likely into the new year before pausing.
Then the long wait for inflation to get to target (or near) before rates start coming down. In the US this is at best 2024 but probably 2025. Locally rates may start moving lower in early 2024.
Shoprite* (JSE code: SHP) results saw the stock down 7.5%. Let's dig into what the market maybe didn't like.
But Shoprite remains one of the best food retailers globally and a core holding in my portfolio. I have bids in the market at around R170 which would put it on a PE closer to the mid-range from the last decade.
Sixty60 grew 150% and remains the absolute market leader in the grocery delivery space.
Checkers Xtra Savings has 24.7m members and it turning into a bank account.
— Simon Brown (@SimonPB) September 4, 2022
Financial Action Task Force (FATF)
Our deadline is September/October after being put on the watch list last year.
Sasol: To answer a separate Q:
The EBIT profit split is:
(Despite the high chemicals contribution, it is amazing to see how closely Sasol’s profit still conforms to the old back-of-a-matchbox calc of 5% of the Rand oil price.)
— Karin Richards (@Richards_Karin) August 23, 2022
R60 dividend, 40% forward DY
HEPS 6723c, forward PE 2.5x
Mis-priced at listing, unbundling often cause this to happen.
Ukraine's war gave it new legs.
Dividends, love them but be careful.
Not an inflation hedge nor a store of value. Just another risk asset. The problem is as QE ends and rates rise, will it still see a strong inflow of money? I think not.
It's not the end crypto, but new highs could be some way off.