Boxer IPO Hits the Market

• Boxer* (JSE code will be BOX) lists on 28 November, debuting at R54/share after a highly oversubscribed IPO.
• Strategies discussed for trading or investing in Boxer shares, including buying through Pick n Pay shares.
• Key takeaway: Patience is key; wait for potential pullbacks.

Two-Pot Retirement Savings and Market Impact

• Early evidence of consumer spending from the two-pot retirement system.
• Stocks like Mr. Price*, Pepkor, and Keith McLachlan’s picks (e.g., Afrimat, Netcare) reviewed as beneficiaries.

Satrix 40 ETF Turns 24

• Launched in 2000, the Satrix 40 has delivered an annualized return of 11.3%.
• Impact: Introduced passive investing and slashed fees for South African investors.

Bitcoin's Psychological Barrier at $100,000

• Bitcoin fell short of the $100K milestone, retracing to around $93K.
• Analysis of big psychological levels in markets and what this means for Bitcoin's momentum.

Bitcoin | Weekly | 27 November 2024

Anglo-Platinum Share Sale

• Anglo-American reduces its stake in Anglo-Platinum, selling at cycle lows.
• Discussion on PGM market challenges and future outlook.

Trump’s Proposed Tariffs

• Announced 10% tariffs on all Chinese imports and 25% on goods from Mexico and Canada.
• Potential economic implications and geopolitical fallout analysed.

Rand, DXY, and Gold

• The Rand holds surprisingly well despite DXY strength; predictions for 2024 suggest potential recovery.
• Gold price fluctuations and long-term bullish outlook.

US$ Index (DXY) | Weekly | 27 November 2024

Commodity Spotlight: Coffee and Cocoa

• Coffee prices hit 20-year highs due to Brazilian droughts, impacting consumer costs.
• Cocoa prices stabilise after a surge, with Nestlé and soft commodity ETFs in focus.

Super Group and SG Fleet Deal

• SG Fleet receives a buyout offer, boosting share prices.
• Opportunities in second-tier stocks like Invicta and Hudaco highlighted for a potentially improving economic environment.

MPC Update

• South African Reserve Bank increases rates by 0.25%, citing risks from core inflation and external pressures.

Simon Brown

* I hold ungeared positions.

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00:00 Market Overview and Boxer IPO Insights
03:08 Two-Pot Money and Consumer Spending Trends
06:03 Satrix 40: A 24-Year Retrospective
08:51 Bitcoin's Psychological Barriers and Market Sentiment
11:40 Anglo-American's Strategic Moves and Market Reactions
14:58 Commodity Prices: Coffee and Cocoa Trends
17:49 Monetary Policy Committee Decisions and Economic Outlook

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October Inflation

• Local CPI at 2.8%, yet prime is 11.5% ahead of the MPC decision this afternoon.
• The gap is far to wide, SARB needs to cut aggressively.

South Africa | Prime vs. CPI

Gold and Bitcoin

• Gold has bounced, but is this for real?
• Bitcoin heading for US$100k

Rand weakness

• The US$ remains string and is hurting the Rand.

US$ Index

Astral results

• Good results
• Paid back R1.1billion short-term debt
• But volatile, a trading stock.

Simon Brown

* I hold ungeared positions.

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Market Overview

Crypto Surge, Gold Decline: Bitcoin rallies as investors shift from gold to crypto. Gold hit a recent high of $2,800 but is now pulling back, possibly towards $2,300-$2,400. Central banks continue to buy gold as a hedge against U.S. dollar dominance and geopolitical risks.

[caption id="attachment_43623" align="aligncenter" width="849"] Gold | Weekly | 13 November 2024

Rand Weakness: The ZAR weakened above 18 to the dollar, driven by strong U.S. dollar demand amidst market volatility. South African Rand overshoots due to its high liquidity, making it vulnerable to sharp moves.

Trump's Impact on Crypto

Market speculation suggests Trump may be crypto-friendly, unlike the current SEC chair Gary Gensler, known for his strict regulatory stance. Potential shifts in the regulatory landscape could benefit cryptocurrencies, particularly Bitcoin.

Simon holds Bitcoin and advises caution: ensure crypto is stored in a hardware wallet for safety.

Bitcoin | Weekly | 13 November 2024

Local Telco Sector: Vodacom & MTN

Both companies struggle with weakened African currencies like the Ethiopian Birr and Egyptian Pound. Profits are impacted when converted back to ZAR.

Despite attractive dividend yields (MTN ~4%, Vodacom ~5.6%), Simon remains bearish, highlighting high capex demands and sector challenges.

Raubex: Construction Sector Bright Spot

Strong results from Raubex, showing resilience in a struggling sector. Diversification into renewable energy and mining operations boosts performance.

Simon notes it as one of the few quality construction plays left, alongside Afrimat.

Consumer Market Struggles

Updates from AVI and BidCorp indicate persistent weak consumer demand, despite optimism from a possible government of national unity. Inflation has eased, but consumer spending remains subdued as households repair balance sheets.

Retail updates show mixed results: Truworths reported disappointing numbers, while The Foschini Group* performed better.

Tencent Results

Tencent posted strong results, though it did not significantly boost Naspers or Prosus stock prices. The market reaction was muted despite the solid performance.

Final Thoughts

The market remains volatile, with significant moves in crypto, gold, and the Rand. Simon advises a cautious approach, with a focus on quality stocks and long-term plays.

Remember: be kind and look out for others. Kindness is rule number one.

Simon Brown

* I hold ungeared positions.

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00:00 Market Overview: Crypto vs Gold
02:50 The Trump Effect on Gold and Crypto
06:01 The Future of the Rand and Emerging Markets
08:55 Sector Analysis: Vodacom, MTN, and Raubex
16:02 Consumer Trends and Company Updates

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Episode Summary: Simon Brown dives into the week’s biggest financial and economic stories, covering Trump’s election win, Nvidia's inclusion in the Dow, rate cuts expected from the FOMC and BOE, and the latest updates on Murray & Roberts, palladium, and gold. Recorded after market open, this episode sheds light on key trades, trends, and the shifting global landscape.

Trump's Victory – What’s the Trade?

• Trump’s presidential win sparks market reactions, with immediate rallies in the S&P, Nasdaq, and Bitcoin.
• Simon discusses potential policy impacts, such as tariffs, technology restrictions on China, and implications for commodities, oil, and the South African economy.
• Notes on the uncertainty of Trump’s policies and their potential effects on inflation, EVs, and cryptocurrency.

Nvidia in the Dow; Intel Out

• Nvidia enters the Dow Jones, replacing Intel. Simon critiques the Dow's price-based index system but acknowledges Nvidia’s stock performance, fuelled by strong demand from major tech firms.
• Discussion on how Nvidia's AI hardware demand could shape future stock gains.

Nvidia | Weekly chart | Close 06 Nov 24

Murray & Roberts Update

• Murray & Roberts faces project downscaling from De Beers, revealing challenges tied to low diamond demand.
• Simon examines the ripple effects across the mining and construction sectors, highlighting how competitor data can provide insights.

Palladium & Gold Trends

• Palladium and gold face downward pressure; Simon explores reasons for the dips, including potential G7 sanctions on Russian palladium.
• Simon highlights that gold’s long-term appeal remains strong, driven by central banks diversifying away from U.S. dollars into gold.

Gold | Weekly chart | 07 Nov 24

Bank Rate Cuts – FOMC & BOE

• Rate cuts anticipated from the FOMC and Bank of England as central banks shift to a rate-cutting cycle. Insights on the potential impact on global markets and currency dynamics.

ASML and AI Hardware Market

• ASML’s forward guidance disappoints, affecting semiconductor market outlook. Simon explains the unique position of ASML in the AI chip supply chain and its long-term value as a buy-the-dip candidate.

CrowdStrike Resurgence

• CrowdStrike's recovery following a Microsoft update issue and Delta lawsuit. Simon assesses the stock’s growth potential in the cybersecurity space.

Listener Takeaway: Markets remain unpredictable but resilient, with global relations, tech policies, and central bank strategies driving shifts. Simon emphasizes informed trading and the long view in these uncertain times.

Simon Brown

* I hold ungeared positions.

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Disclaimers: The JSE Direct podcast is independent of JSE Limited and reflects Simon Brown’s views, not necessarily those of the JSE. Always consider risks when investing.