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Eskom uncertainties cap rand gains

13 January 2020

Eskom uncertainties cap rand gains

Daily Investment Update

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Market commentary

SA flag Icon
South Africa

The JSE ended the week with a four-week winning streak, but the renewed blackouts across South Africa and geopolitical tension fuelled investor unrest, especially towards emerging markets. At the closing bell, the JSE All Share Index was 0.62% higher.

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United States

Despite posting gains for the week, most US indices closed down on Friday due to lower-than-expected jobs data for December and a sell-off in stocks. The S&P 500 ended down by 0.29%.

EU flag Icon
Europe

European markets traded flat on Friday as strong travel and leisure shares were countered by weak US jobs growth for December. The pan-European STOXX 600 Index lost 0.12%.

HK flag Icon
Hong Kong

Hong Kong shares closed higher on Friday due to upbeat trade as investors anticipated the first phase of a US-China trade agreement. At 22h25 on Sunday, the Hang Seng was 0.27% higher.

Japan flag Icon
Japan

Japanese markets rose on Friday on the back of eased tensions in the Middle East and optimism around a possible Phase 1 trade agreement between the US and China. The Nikkei traded 0.47% higher on Sunday at 22h25.

Rand Icon
Rand

The local currency had a strong run in the past week, however, renewed load shedding and the resignation of Eskom Chairman Jabu Mabuza on Friday afternoon weighed on the rand. At 22h30 on Sunday, the dollar was trading at R14.34, the pound at R18.69 and the euro at R15.95.

Precious metals Icon
Precious metals

Gold prices soared in the past week as investors sought refuge in safe-haven assets due to the tensions between Washington and Tehran. Spot gold traded at $1 562.22 at 22h30 on Sunday.

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Oil

The head of the International Energy Agency said on Friday that the “global oil market is expected to be well-supplied in 2020 and demand growth could stay weak, keeping a lid on prices”. At 22h25 on Sunday, a barrel of Brent crude traded at $65.86.


Market indicators

Local markets (R)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
ALSI 57 484.84 0.62 3.86 4.71 1.62 11.65
Gold mining 2 761.78 - 0.18 7.17 9.98 36.39 99.57
Basic minerals 35 605.32 0.38 2.29 10.94 9.96 28.93
Industrial index 76 669.18 0.98 6.88 3.23 - 0.67 10.01
Financial 38 828.15 0.28 0.60 0.25 - 3.86 - 2.46
Fin + Ind 30 7 506.47 0.73 4.57 2.16 - 1.73 5.64
International markets (Base currency)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Dow Jones (USD) 28 823.77 - 0.46 3.47 9.44 8.62 23.03
S&P 500 PR (USD) 3 265.35 - 0.29 4.40 11.68 10.18 28.30
NASDAQ (USD) 9 178.86 - 0.27 6.61 15.75 12.50 32.82
FT-100 (GBP) 7 587.85 - 0.14 5.31 6.26 2.84 14.37
Hang Seng (HKD) 28 638.20 0.27 8.33 11.57 2.65 11.91
Nikkei 225 (JPY) 23 850.57 0.47 2.05 10.86 11.86 20.81
MSCI World (USD) 6 968.13 - 0.09 3.95 10.95 8.88 23.85
Frankfurt (EUR) 6 014.16 - 0.09 3.16 10.84 8.97 23.46
Other markets
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Gold ($) 1 547.85 - 2.21 5.76 2.96 11.52 20.80
Platinum ($) 973.00 1.99 7.87 9.33 19.68 18.08
Brent Oil ($) 64.98 - 0.60 0.99 9.95 - 3.03 5.35
Rand/USD 14.32 - 0.80 0.24 4.07 - 2.43 - 3.49
Rand/GBP 18.67 - 0.51 2.23 1.97 - 7.55 - 5.68
Rand/EUR 15.93 - 1.04 0.43 3.23 - 1.65 0.10
ALBI (R) 699.76 0.11 2.03 0.93 2.37 9.11
  1. Some data may be delayed, the above table reflects the latest available information
  2. Performance reported during the first week of each month may be impacted by distributions. Distributions are fully accounted for by the second week of each month


Economic calendar

Local International
  1. No economic data scheduled for release.
  1. UK: Balance of trade NOV
  2. US-China trade talks
  3. CN: Balance of trade DEC (Tuesday 05h00)

Source: Reuters, Business Day, Trading Economics


PSG Product Matrix

Fund matrix

PSG Wealth Solutions
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Enhanced Interest D 3.82 7.91 7.95 8.00 8.02 7.78
PSG Wealth Income FoF D 3.35 8.09 7.48 7.90 8.27 8.04
PSG Wealth Preserver FoF D 2.39 7.64 4.33 5.88 6.05 6.59
PSG Wealth Moderate FoF D 2.76 9.31 2.57 5.38 6.04 6.10
PSG Wealth Creator FoF D 4.48 10.03 0.61 4.78 7.01 4.89
PSG Wealth Global Moderate FF D 5.86 16.04 10.05 7.61 3.75 8.26
PSG Wealth Global Creator FF D 9.38 30.41 16.79 15.53 9.90 -
PSG Wealth Solutions ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Moderate FoF D 6.09 13.86 2.67 6.37 7.02 3.86
PSG Wealth Global Creator FoF D 10.03 27.73 8.91 14.14 13.36 9.86
PSG Wealth Global Preserver FoF (USD) D 3.10 9.19 3.12 4.58 6.10 4.31
PSG Wealth Global Flexible FoF (USD) D 7.13 18.39 6.71 11.87 11.76 8.82
PSG Wealth Solutions (£)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Preserver FoF (GBP) D - 0.57 7.06 4.22 3.35 8.07 6.29
PSG Wealth Global Flexible FoF (GBP) D 2.37 16.08 8.05 9.15 13.70 10.87
PSG Asset Management
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Money Market A 3.52 7.23 7.27 7.36 7.37 7.19
PSG Income A 3.75 8.08 8.11 8.31 8.37 7.97
PSG Diversified Income 2.55 6.56 6.53 7.29 7.63 7.62
PSG Stable A 0.59 1.13 1.66 4.13 5.85 5.82
PSG Balanced A - 0.69 - 3.17 - 3.08 1.21 5.10 4.49
PSG Flexible A - 0.06 - 2.63 - 3.05 1.16 6.23 5.39
PSG SA Equity D - 5.38 - 14.70 - 12.56 - 5.80 - -
PSG Equity A - 2.39 - 8.26 - 8.14 - 2.05 6.17 2.45
PSG Global Flexible FF A 1.36 3.26 1.75 3.01 4.24 -
PSG Global Equity FF A 1.43 3.32 0.69 3.55 5.34 6.23
PSG Asset Management ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Global Flexible USD A 2.11 0.99 - 4.96 2.26 8.12 2.76
PSG Global Equity USD 2.19 0.80 - 5.86 2.83 9.18 2.68
PSG Direct Portfolios
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Direct Flexible Income 3.04 6.93 6.94 7.34 7.50 7.26
PSG Direct Low Equity 0.44 0.68 1.01 3.58 5.54 5.39
PSG Direct Managed - 0.76 - 3.47 - 3.51 0.74 4.90 4.24
PSG Direct Aggressive - 0.63 - 3.41 - 3.86 0.28 5.48 -
PSG Direct Global Managed 1.13 2.80 1.28 2.54 3.76 -
PSG Direct Global Aggressive 1.18 2.84 0.63 2.89 4.46 -
  1. The PSG Wealth Solutions are exclusively available through registered PSG planners and/or advisers
  2. The above information reflects the latest available data at time of distribution, as such product performance data reflects T-2 numbers
  3. Performance reported during the first week of each month may be impacted by distributions. Distributions are fully accounted for by the second week of each month
  4. The PSG Best Ideas Portfolios were renamed to the PSG Direct Portfolios in February 2018

Equity portfolio matrix

PSG Wealth House View Portfolios
Portfolio 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth SA Equity Portfolio - 2.18 - 3.81 - 4.03 0.98 5.14 -
PSG Wealth SA Property Equity Portfolio - 4.84 - 5.84 - 10.98 - 5.11 - 3.34 -
PSG Wealth SA Dividend Income Equity Portfolio - 3.46 - 5.20 - 6.00 1.19 - -
PSG Wealth Offshore Equity Portfolio (USD) 9.64 22.68 10.07 16.37 15.56 -
PSG Wealth Managed Volatility Equity Portfolio - 2.97 - 6.06 - 8.03 - 2.92 - -
  1. The PSG Wealth equity portfolios are exclusively available through registered PSG planners and/or advisers
  2. PSG Wealth equity portfolio performance are shown gross of management fees, but net of brokerage and other trading costs
  3. PSG Wealth SA and Offshore Equity Portfolio Inception date: 30 August 2015
  4. PSG Wealth SA Listed Property Portfolio Inception date: 1 December 2015
  5. PSG Wealth Dividend Income Equity Portfolio Inception date: 29 April 2016
  6. PSG Wealth Managed Volatility Equity Portfolio Inception date: 28 July 2016
  7. PSG Wealth Funds are exclusively available through registered PSG planners and/or advisers


Recent Investment Ideas

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Highlights

  • Our recommendation for PFE US is overweight; click here to read the full report on our secure site.
  • The group has been able to protect its gross profit margins despite the challenging trading environment because of its scale and defensive nature.
  • We believe Pfizer is a high-quality company with a high ROE and an attractive and sustainable operating margin.


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Highlights

  • Our recommendation for MCG SJ is overweight; click here to read the full report on our secure site.
  • Having only listed on the JSE in February 2019, MultiChoice has already seen its shares grow by approximately 17% to R125.
  • At these levels, and trading at a forward P/E of 15 times, we believe that MultiChoice is still undervalued and is well-positioned to benefit from mass-market growth in both South and Southern Africa.


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Highlights

  • Our recommendation for SOL SJ is underweight; click here to read the full report on our secure site.
  • Sasol is currently facing an increased risk profile through the decline in chemical product prices, a severely constrained balance sheet and slowing global economic backdrop.
  • The group’s chemicals business is also facing growing competition from additional ethylene capacity/supply into the market.


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Author
author

Adriaan Pask PhD

Chief Investment Officer


At PSG Wealth
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