Welcome to the end of the week! If you're an investor in local retailers, you surely need a break by now. Luckily, the Springboks should do a great job again this weekend of showing the world how strong South Africans really are.
We need to keep winning on the field, as much has been written on the unsuccessful international expansion of many South African corporates, particularly in the retail sector. Not enough has been written on the companies that got it right, so it's worth highlighting OUTsurance as an excellent example. The latest results reveal solid performance both in South Africa and Australia, with the key difference being that OUTsurance built the Aussie business from the ground up vs. going off and doing a major acquisition. Slow and steady does indeed win the race, with OUTsurance now taking the same approach in Ireland.
Also in Ghost Bites today, you'll find strong numbers from Sanlam, along with gold sector updates from Harmony Gold and Pan African Resources. Metair still has a big job ahead with the balance sheet restructure and Omnia has released a capital markets day presentation highlighting its strategy.
Get all these stories and more in Ghost Bites>>>
For those in the financial services industry, Jatin Kasan and Julian Davids of Forvis Mazars have written on the SARB's annual report on organisational resilience. This is a technical but highly important space, with the team also sharing insights from clients in this piece>>>
As you know by now, a Friday mailer also means that we get the summaries from DealMakers of recent corporate activity. As ever, the team has written on South African M&A and South African corporate finance, as well as provided pieces on en commandite partnerships and sustainable development funding.
Enjoy the rugby and look out for Ghost Mail Weekender on Sunday morning.
PS: Don't forget to register for free to attend Unlock the Stock next week with CA Sales Holdings! |
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FEATURED: The Trader's Handbook Ep 5 |
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| | IG Markets Episode 5: Pairs trading offers a great opportunity to play one stock off against another, a strategy that means you can take short positions even in a more bullish market. Learn all about it at this link>>> |
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FEATURED: Mastering your portfolio with ETFs and single stocks |
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Ghost Stories: Doing your own research is a great concept and all, but how do you actually do it for both ETFs and single stocks? In this podcast with Siyabulela Nomoyi of Satrix, we dug into this topic. Find it here>>> |
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FEATURED: Magic Markets - The India Opportunity |
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| | China is usually the topic of conversation when it comes to fast-growing emerging markets. There are very good reasons to believe that India will play that role going forward. This creates a proper opportunity for investors and corporates alike. Learn more here>>> |
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FEATURED: Focus on the future - SARB's annual report on organisational resilience |
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Forvis Mazars: Within the banking sector, organisational resilience is becoming increasingly critical in South Africa, as highlighted in the SARB’s Annual Report. Get the Forvis Mazars team's views and client experiences in this article. |
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Ghost Bites: The latest on Harmony Gold, Metair, Omnia, OUTsurance, Pan African Resources and Sanlam, along with various Little Bites in Ghost Bites here>>> |
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| | Ghost Wrap: In this fast-paced podcast, I covered CA Sales Holdings, RCL Foods + Rainbow Chicken, Motus and Bidvest. Made possible by the support of Forvis Mazars, you can find it here>>> |
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- Investec Podcast: As part of the Investec No Ordinary Wednesday series, you can enjoy Jeremy Maggs in conversation with Tinus Rautenbach, head of Investec's online platform Clarity, as they discuss the rise of self-directed investing. Find it here>>>
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- Nico Katzke of Satrix: The GNU has driven significant optimism around the South African market. To help us understand where this is playing out and how the carry trade protects the rand, Nico Katzke joined me on Ghost Stories. Find it here>>>
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International Business Snippet: |
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The European automotive industry is facing a crisis. The threat from China was severely underestimated. All you need to do is look around you on South African roads to see the impact. Although it will take a lot longer for that level of market penetration to be achieved in places like Europe, the economics of automotive manufacturing mean that any loss of market share by the big brands will have a significant effect on their profits.
The German economy is particularly exposed, with a difficult recent narrative at the likes of Mercedes-Benz, BMW and Volkswagen. European governments pressured their manufacturers into pouring all their efforts in R&D into electric vehicles. With hybrids proving to be the more popular technology, this has really put them at a disadvantage vs. the likes of Toyota who focused on hybrids, or the Chinese manufacturers who can produce a solid product at a decent cost.
We are witnessing disruption before our very eyes.
Our report on Ulta Beauty is now available to our Magic Markets Premium subscribers. If you're keen to get the latest on the company, as well as access to our vast library of stock research notes based on our work in the markets and what we do with our own money, then take out a subscription for just R99/month. Thank me later. |
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IG Morning Call: daily macroeconomic update |
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Equity markets continue to caution ahead of US jobs data out later this afternoon. Fed fund futures are currently assigning a 40% probability for a 50-basis point rate at the Federal Reserve meeting this month. Should the employment data miss, it is likely that the implied probability for a 50-basis point rate is increased, which could cause more angst in the marketplace on growth and carry trade concerns. For a rebound in equity markets, traders will want to see the data in line or slightly ahead of consensus.
The dollar has continued to soften along with US Treasury Yields on the increasing likelihood of an outsized rate cut by the Fed. The rand has gained against a weakening dollar.
Oil prices are trading at their lowest levels since December last year, despite OPEC+ looking to delay an increase in supply. Citi Bank has released a report suggesting that oil markets will be in oversupply in 2025 and that the price of brent crude could drift down to $60/barrel.
Gold has started to renew gains in an inverse correlation to movements on the dollar.
Key Indicators: USD/ZAR R17.70/$ | US 10yr 3.71% | Gold $2,520/oz | Platinum $928/oz | Brent Crude $72.59
The macroeconomic update is based on IG's morning call update |
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