Hello again from Dubai on the last day of my trip. On Monday, it will be hello from Cape Town - an oasis of world-class food at prices that are far friendlier to Randela earners. After a great day of exploring Dubai yesterday, I finished off with a swim at one of the night beaches. If you can imagine the saltiest bath possible, you're on the right track in terms of the experience. It really is quite hilarious to feel such heat on your skin when the sun isn't even up anymore.
Today, I will no doubt pop in at the exotic car dealers where the wealthiest of Dubai residents buy exotics like Paganis and Bugattis. I'll also be going to the Topgolf here, which I'm very excited about. I must say, I first visited Dubai roughly ten years ago and the changes since then are clear. There is now a strong "middle class" in Dubai, as so many families have relocated here.
Speaking of families, at least I'm seeing lots of kids again. The birth rate problem in the developed world was obvious in London, which is admittedly not the most kid-friendly place around. It has become prohibitively expensive to have children in cities like that, so people are prioritising careers and travel instead. You can read about news from all over the world, but there's no replacement for seeing it yourself.
Fresh out the oven: -
Ghost Bites: Sirius Real Estate just doesn't sit still, with yet more deals announced. Standard Bank's earnings growth has slowed down. Sasol is set to receive a windfall. Coronation is expecting the tax ruling from the Constitutional Court today. Harmony is having a strong financial year. Grindrod Shipping's deal was approved. Get the details in Ghost Bites>>>
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Magic Markets: With my travels abroad in the past week and the incredible improvement in sentiment back home, this was the perfect opportunity to focus on the dangers of home country bias in the latest episode of Magic Markets. For offshore vs. SA financial insights (including life on the ground), 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. You can watch it here. Next up on Unlock the Stock will be a double-header of Spear REIT and Adcorp on 27 June. You can register for free here.
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In case you missed it: -
Dominique Olivier: With my passion for racing clearly contagious, Dominique Olivier decided to dig into the history of Le Mans and how the technology on the racetrack ends up in the cars we drive every day. Read it 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:
Sirius Real Estate follows the most basic principle of all: buy low and sell high. There aren't many property funds that follow an active approach and there are even fewer that get it right on a regular basis. The latest deals at Sirius demonstrate their approach.
Standard Bank has seen a slowdown in earnings growth, driven by the combination of a strong base period and the trends in African currencies.
Sasol shareholders finally have something to smile about, with a potential windfall at the expense of Transnet. The court process isn't over just yet, though.
This is a very important day for Coronation, with the Constitutional Court due to release its judgment on the all-important tax matter. Many corporates will be keeping a close eye on that today.
Harmony is on track for a strong financal year, although the recent safety track record remains a significant concern.
Grindrod Shipping's shareholders voted strongly in favour of the deal that is effectively a take-out of minority shareholders.
There were also a vast number of director dealings yesterday, so don't miss that in Little Bites today.
All these stories, plus the Little Bites, are available 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:
In the US market, Darden Restaurants is an interesting company. Unlike most of the listed restaurant groups that focus on scalable franchise formats, Darden has a more upmarket offering with chains of eat-in restaurants. These tend to be harder to scale, so such examples are far less common on the market than e.g. McDonald's or Starbucks.
If you've travelled abroad, you'll know that eating out at a restaurant is a far more expensive thing to do than in South Africa, even on a relative basis. This leaves such businesses highly exposed to levels of consumer spending, with Darden reporting a weak consumer environment. For fiscal year 2025, Darden expects same-store sales to grow just 1% to 2%. Inflation is really hitting the average consumer in developed markets.
We covered Stellantis in Magic Markets Premium 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 rand retreated to R18.17 at one point yesterday as we saw profit-taking in the local equity and bond markets. The situation looks different this morning, with the rand dipping below R18.00 once more.
US new jobless claims came in at 238k vs. market estimates of 235k, while both US housing starts and building permits were negative in May. Despite this, the dollar firmed after Minneapolis Fed President Kashkari said that inflation would likely take two years to reach the Fed's 2.0% target.
Over in the UK, the Bank of England kept rates unchanged.
Today, PMI data is due with the main focus being on the US manufacturing and services numbers.
Key indicators: USD/ZAR R17.96; US 10-year 4.26%; Gold $2,363; Platinum ZAR R17,668; Brent Crude $85.62
This macroeconomic update is based on TreasuryONE's morning update. |
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