Hello from Radlett in North London, where I spent yesterday recovering from one of the most taxing and rewarding experiences of my life. Le Mans is an incredible place, but the endurance flavour on track certainly extends to the in-person experience. The crowds, noise and general chaos permeate your body until you arrive home and collapse into a warm bed where you don't have to queue for the bathroom. I'm so glad I did it. I'm equally thrilled to have a day of meetings ahead in London, where summer has finally arrived it seems.
Fresh out the oven: -
Ghost Bites: Novus was the only news of the day on Friday, but it made for excellent reading as an example of how a group can evolve. Get the details in Ghost Bites>>>
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Magic Markets: The release of US jobs data is more important than you might think. In this episode, we explain the different types of releases and why they matter. Find it here>>>
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Unlock the Stock: Calgro M3 has been quite the story recently. To unpack the performance and prospects, the management team recently joined us on Unlock the Stock. Watch it here>>>
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In case you missed it: -
Ghost Stories with Kingsley Williams of Satrix: There is only one free lunch in investing. Aside from the benefits of diversification, we discussed many other elements of investing. You can enjoy it here>>>
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Ghost Stories with Michael Field of Fedgroup: There are different ways to think about portfolio construction and how important elements like yield and inflation protection can be brought in. Learn more here>>>
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Ghost Wrap: You need just five minutes to get up to speed on Capital Appreciation, MultiChoice, Spar and The Foschini Group, thanks to Mazars. Find it here>>>
- The Current brought to you by Investec: This year, SA is set to become the tenth-largest solar market in the world. In episode 4, Iman Rappetti spoke with Investec's Melanie Humphries, Bernard Geldenhuys and De Wet Taljaard from SAPVIA to explore SA’s apparent solar boom. Enjoy it here>>>
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Learn all about Calgro M3 |
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Calgro M3 is an excellent example of one of the smaller companies on the JSE that has delivered very strong recent share price returns.
To understand why, watch the recording of Unlock the Stock with the Calgro management team, available here. |
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Local company news:
After Novus teased us with earnings guidance, the company released results on Friday. They were worth the wait. Although the original divisions are struggling for top-line growth, the major focus on profitability has paid off. But the real story, of course, is the Maskew Miller Learning (MML) acquisition and what that means for the group.
Now the largest profit contributor by a country mile, MML will be taken to the next level through the introduction of AI to the business. Well, that's the plan at least. As always, execution is what counts.
Along with a few Little Bites, you can get all the details on Novus and its strong financial performance in Ghost Bites at this link>>>
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Le Mans: The Race to Innovate |
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Much of the technology in your road car was first proven on the toughest of stages: endurance racing. Specifically, Le Mans.
In the spirit of my first experience watching the race, Dominique Olivier did what she loves most and dug into the trivia. Read it here>>> |
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The only free lunch in investing |
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With volatility as the theme in markets in a year of elections, it’s important to keep your head as an equity investor. Take a long-term view and let the market do its job. Easier said than done, of course.
Kingsley Williams joined me to share practical tips and important insights into investing. The podcast and full transcript are available here. |
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International business news:
If you have a sweet tooth, I suggest you look away now. The prices of cocoa are climbing again, which certainly isn't good news for global manufacturers like Hershey and Mondelez. Years of taking advantage of cocoa farmers in West Africa may finally be biting the global producers, with a supply crunch driving prices higher.
When farmers are paid so little for their crops, they are incentivised to consider other options. The rubber has literally hit the road now, as rubber is an alternative that has lured many farmers away from cocoa. Of course, as the cocoa price moves higher, more farmers might be tempted back to the crop. That's how a cycle works.
Some of the large chocolate manufacturers have supply contracts locked in at old prices until 2025. But once those contracts expire, there's trouble ahead for the price of chocolate. Frankly, if the price of chocolate in the supermarket means that the farmers are starving, then chocolate needs to be more expensive. It's as simple as that.
We covered Lululemon in Magic Markets Premium last week and we are covering Stellantis this week. To get access to this research and the rest of the vast library, subscribe to the platform here. |
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Macroeconomic Update The dollar is on the front foot, trading at its strongest level this year. Investors are flocking to the dollar as a safe haven, enjoying high US Treasury yields along the way.
This gives even more context to the performance of the rand, which has reversed most of the post-election pressure to trade at the levels seen before we went to the polls. The markets have digested the loss of power for the ANC and the way in which it was handled. From here, it's likely that the rand will return to tracking the moves seen in most emerging market currencies, at least in the short term.
The Reserve Bank of Australia kept rates on hold this morning. Later today, Eurozone inflation for May will be released, expected to rise to 2.6% year-on-year. US retail sales figures are also due today, expected to show the tiniest positive movement.
Key indicators: USD/ZAR R18.28; US 10-year 4.27%; Gold $2,321; Platinum ZAR R17,804; Brent Crude $84.11
This macroeconomic update is based on TreasuryONE's morning update. |
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