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In our continued efforts to give our readers a broad number of views, opinions and information, we continue to provide PSG's daily market updates and add our own daily inputs in at the end.
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Short summary of PSG's market commentary for 30 May 2019
South Africa
In spite of global risk aversion on Wednesday after world markets succumbed to the pressure from concerns over the ongoing US-Sino trade spat, the JSE ended in the green thanks to a strong performance by banks, financials and resources. Shortly after the closing bell, the All Share gained 1.05%.
United States
US equities plunged to a more than two-month low on Wednesday as Beijing showed intent to further escalate its trade war with Washington, prompting a global sell-off in riskier assets and escalating concerns of a prolonged trade war on global economic growth. At 19h00, the Dow had lost 0.11%.
Europe
European shares took a dive on Wednesday as reports of China’s intention to cut its supply of rare earth elements to the US surfaced, pushing investors towards safe-haven assets. At 19h15, the pan-European Stoxx 600 lost 1.43%.
Hong Kong
Tracking losses incurred by regional counters, shares in Hong Kong slid on Wednesday as fears over slowing global growth and trade tensions between two of the world’s biggest economies showed no signs of easing. At 19h20, the Hang-Seng lost 0.57%.
Japan
Japan’s Nikkei fell to a two-week low on Wednesday as trade tensions and apprehensions over a slowing global economy weighed heavily on sentiment. At the closing bell, the Nikkei had lost 1.20%.
Rand
The rand plunged to a seven-month low on Wednesday afternoon as political uncertainty took its toll while speculators awaited the appointment of President Ramaphosa’s new cabinet. At 19h30, the rand traded at R14.74 against the dollar.
Precious metals
Wednesday’s silver lining was an upsurge in gold prices as investors opted to stay away from riskier assets on the back of trade war concerns, boosting the appeal of bullion. At 19h50, spot gold was down trading at $1 281.39 an ounce.
Oil
Oil prices lost over 2% on Wednesday as China indicated its intention to drag the protracted trade war with the US by limiting its supply of rare-earth elements and use that as bargaining power, running the risk of an ongoing standoff which could hurt crude demand. At 19h45, a barrel of Brent crude was trading at $69.29.
In spite of global risk aversion on Wednesday after world markets succumbed to the pressure from concerns over the ongoing US-Sino trade spat, the JSE ended in the green thanks to a strong performance by banks, financials and resources. Shortly after the closing bell, the All Share gained 1.05%.
United States
US equities plunged to a more than two-month low on Wednesday as Beijing showed intent to further escalate its trade war with Washington, prompting a global sell-off in riskier assets and escalating concerns of a prolonged trade war on global economic growth. At 19h00, the Dow had lost 0.11%.
Europe
European shares took a dive on Wednesday as reports of China’s intention to cut its supply of rare earth elements to the US surfaced, pushing investors towards safe-haven assets. At 19h15, the pan-European Stoxx 600 lost 1.43%.
Hong Kong
Tracking losses incurred by regional counters, shares in Hong Kong slid on Wednesday as fears over slowing global growth and trade tensions between two of the world’s biggest economies showed no signs of easing. At 19h20, the Hang-Seng lost 0.57%.
Japan
Japan’s Nikkei fell to a two-week low on Wednesday as trade tensions and apprehensions over a slowing global economy weighed heavily on sentiment. At the closing bell, the Nikkei had lost 1.20%.
Rand
The rand plunged to a seven-month low on Wednesday afternoon as political uncertainty took its toll while speculators awaited the appointment of President Ramaphosa’s new cabinet. At 19h30, the rand traded at R14.74 against the dollar.
Precious metals
Wednesday’s silver lining was an upsurge in gold prices as investors opted to stay away from riskier assets on the back of trade war concerns, boosting the appeal of bullion. At 19h50, spot gold was down trading at $1 281.39 an ounce.
Oil
Oil prices lost over 2% on Wednesday as China indicated its intention to drag the protracted trade war with the US by limiting its supply of rare-earth elements and use that as bargaining power, running the risk of an ongoing standoff which could hurt crude demand. At 19h45, a barrel of Brent crude was trading at $69.29.
Our daily update
Yesterday we covered struggling fast food and casual dining group , Famous Brands' latest financial results. Below a short extract from the article.
GROUP PERFORMANCE
Our key strategic focus areas during the review period were to:
In the Leading (mainstream) brands portfolio, we made good progress in aligning our supply chain and cost drivers to provide better support for the brands, to ensure they are positioned to deliver like-for-like growth ahead of food inflation. In the Signature (niche) brands portfolio, following our sustained investment over recent years, our interventions were directed at significantly improving our own operating margins in this division.
Across the Leading and Signature brands, we continued to review and optimise our footprint in terms of trading relevance, rental viability, changes in footfall, and competitor activity. Our goal to deliver sustainable returns to our shareholders is underpinned by ensuring that GBK Restaurants Limited ("GBK") outperforms the UK casual dining market and delivers ahead of our targeted performance. On 11 December 2018 we notified shareholders that GBK UK had completed a Company Voluntary Arrangement (CVA) aimed at improving the financial viability of the business. Management is optimistic that remedial actions underway to ensure the long term sustainability of the business are gaining momentum, reflected by the stronger trading results reported for the second half of the year compared to the first half, and the positive like-for-like sales recorded in the period since year-end.
Read the full article here.
GROUP PERFORMANCE
Our key strategic focus areas during the review period were to:
- enhance the profitability of our franchise partners and the viability of the franchise model;
- ensure the improvement of returns for stakeholders through refining and implementing our long-term strategy in the UK; and
- optimise allocation of capital in the business.
In the Leading (mainstream) brands portfolio, we made good progress in aligning our supply chain and cost drivers to provide better support for the brands, to ensure they are positioned to deliver like-for-like growth ahead of food inflation. In the Signature (niche) brands portfolio, following our sustained investment over recent years, our interventions were directed at significantly improving our own operating margins in this division.
Across the Leading and Signature brands, we continued to review and optimise our footprint in terms of trading relevance, rental viability, changes in footfall, and competitor activity. Our goal to deliver sustainable returns to our shareholders is underpinned by ensuring that GBK Restaurants Limited ("GBK") outperforms the UK casual dining market and delivers ahead of our targeted performance. On 11 December 2018 we notified shareholders that GBK UK had completed a Company Voluntary Arrangement (CVA) aimed at improving the financial viability of the business. Management is optimistic that remedial actions underway to ensure the long term sustainability of the business are gaining momentum, reflected by the stronger trading results reported for the second half of the year compared to the first half, and the positive like-for-like sales recorded in the period since year-end.
Read the full article here.
Our JSE All Share index daily performance calendar
Visit our JSE Calendar tracker page for a expanded version of the calendar below
The graphic below provides the daily returns of the JSE All Share Index (J203) on a calendar chart. Provides a great overview of the All share index over the course of the month. It will be updated daily with our daily investment update as received from PSG.
The month of May continues to be negative, and this after 4 months of positive returns for the JSE All Share Index. As can be seen from the Calendar chart above the number of red blocks far outnumber the number of green blocks. It has been a pretty miserable month so far on the JSE, and May has wiped out almost half of the returns the market made in the first 4 months of 2019. Seems like sell in May and stay away is holding true.
For more on daily market movements see our 2019 Calendar tracker.
But we as South African investors are losing out in Dollar terms. Largely due to continued Rand weakness not only over the short term but over the last couple of years. We continue to advise investors to take money out of South Africa and invest it offshore. Looking for ideas for investments to make? Go read this article
For more on daily market movements see our 2019 Calendar tracker.
But we as South African investors are losing out in Dollar terms. Largely due to continued Rand weakness not only over the short term but over the last couple of years. We continue to advise investors to take money out of South Africa and invest it offshore. Looking for ideas for investments to make? Go read this article