It feels like everything is on fire right now and that there aren't many places to hide. In a market with this much volatility, a cautious and well-informed strategy is the only way to play. I cannot stress this next point enough: the more you read, the better your chances of success.
The good news is that you're in the right place.
Let's start with the update from Wichard Cilliers, Head of Market Risk at TreasuryONE:
"As we expected, the MPC of the SARB hiked the interest rate by 50 basis points. The vote was 4-1 in favour of a 50bps hike, with one member voting for a 25bps hike. The vote was based on more pressure on inflation, especially on fuel and food prices. The 50bps point hike helps the ZAR's carry trade attractiveness and we did see the ZAR strengthen after the announcement, although the market did price for the hike. The USD/ZAR traded all way down to R15.77 in the i mmediate aftermath of the decision but has since relinquished some of the gains and is currently trading at R15.85. A weaker USD also added to the momentum and we will need to see if this weakness in the USD continues."
So, the rate hike is great news for the rand and for pensioners. It's not such good news for the repayments on a 320i M Sport with a 40% residual structure.
Kick off your day with Ghost Bites, a great summary of all the news on the JSE yesterday. It's long enough to be insightful and short enough to be interesting, just like a hedge fund.
One of the feature articles is on Afrimat's results. With one of the best track records on the JSE of earnings growth, it's always remarkable to see how this company manages to smooth out the cycles and deliver retu rns to shareholders. Learn more about the results here and take the opportunity after reading the article to click through to the Magic Markets episode with CEO Andries van Heerden and Afrimat's presentation on Unlock the Stock.
Speaking of Unlock the Stock, next week Thursday is your opportunity to engage directly with the management team of Calgro M3. I wrote about Calgro's results earlier this week, which will give you more context. Unlock the Stock gives you an opportunity to attend an online presentation by the executives and ask them questions thereafter. With only Cal gro joining us next week instead of the usual two-company format, there's ample opportunity to really get to know the company. Attendance is free, as we are committed to empowering retail investors just like you. All you have to do is register at this link to attend at 12pm on Thursday 26th May.
My other feature article today is on Massmart. I really didn't hold back here, as the group is just going from bad to worse with sales growth that isn't even keeping up with inflation. You may not be sure whether to laugh or cry while reading about Messmart's pink elephant in the room.
E very Friday, we are treated to great content from the team at DealMakers. There are summaries of the deals announced in the past week in case you missed them, as well as a piece by Mathew Visser of PKF Octagon on how current market conditions are impacting M&A and other deal strategies.
If you are interested in the corporate finance industry, then you'll find the M&A ranking tables fascinating. Every year, DealMakers tracks the deals on the market and keeps a scorecard of the leading corporate advisors, JSE sponsors, legal advisors and transaction support providers. Check out the rankin g tables here.
Flicking across to Magic Markets, the latest free show is a wonderful chat about private equity. This sits on the investment spectrum between venture capital at one end and public markets at the other. Together with private equity specialist Rob Grieve from Westbrooke Alternative Asset Management, we discussed key dealmaking concepts and the differences between the UK market and the local market. This is genuinely one that you don't want to miss! Listen at this link.
Have a wonderful weekend and thank you for reading Ghost Mail!
