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More vaccine hopes lift sentiment

17 November 2020

More vaccine hopes lift sentiment

Daily Investment Update

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Market commentary

SA flag Icon
South Africa

The JSE started the week slightly higher, closing up 0.15%, lifted by vaccine optimism as a US biotechnology company announced positive trial results; however, gains were capped as Shoprite reported a loss of over 8% for the day.

US flag Icon
United States

Wall Street started the week strong after reports from a US-based biotech group, Moderna, stated that “its experimental vaccine was 94.5% effective in preventing COVID-19”. At 17h50, the Dow Jones had gained 1.25%.

EU flag Icon
Europe

Optimistic sentiment boosted European markets on Monday thanks to Moderna’s news and economic recovery signs from Asia. The STOXX 600 closed 1.18% higher.

HK flag Icon
Hong Kong

The Hang Seng started the week on a higher note and closed at 0.86% as positive data from mainland China indicated that the world’s second-largest economy is recovering.

Japan flag Icon
Japan

The Nikkei closed 2.05% in the green on Monday, reaching its highest point in 29 years after Japan's economy reported its “first expansion in four quarters”.

Rand Icon
Rand

Emerging market currencies enjoyed a boost on Monday thanks to Moderna’s vaccine news; the local currency even more so as investors digested reports that the country’s economic growth strategy is back on track. At 17h50, the rand traded at R15.35/$.

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Precious metals

Gold prices edged up on Monday as investors evaluated the rising global COVID-19 cases, possible US stimulus plans and Moderna’s vaccine claims.

Oil Icon
Oil

Oil prices rose to $44.19 a barrel for Brent crude on Monday, an almost 2% climb, due to Moderna’s clam that “its experimental vaccine was 94.5% effective in preventing COVID-19”.


Market indicators

Local markets (R)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
ALSI 57 267.00 0.15 4.05 1.17 16.49 5.07
Gold mining 4 153.95 - 3.57 - 20.67 - 26.33 - 14.03 70.16
Basic minerals 37 773.17 1.62 - 3.27 - 9.38 18.95 17.96
Industrial index 83 697.23 - 0.98 5.39 6.25 11.88 14.92
Financial 28 768.62 0.46 16.77 11.12 25.63 - 26.07
Fin + Ind 30 7 260.55 - 0.59 8.28 7.54 15.32 - 0.35
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) 29 950.44 1.60 4.86 7.78 27.85 9.41
S&P 500 PR (USD) 3 626.91 1.17 4.24 7.98 27.75 18.40
NASDAQ (USD) 11 829.29 1.03 - 0.23 7.35 34.04 40.78
FT-100 (GBP) 6 421.29 1.66 8.76 6.09 12.42 - 9.21
Hang Seng (HKD) 26 381.67 0.86 8.23 5.44 14.01 3.45
Nikkei 225 (JPY) 25 906.93 2.05 10.69 12.00 30.32 13.38
MSCI World (USD) 7 614.48 1.28 5.07 7.82 28.47 14.04
Frankfurt (EUR) 5 686.05 0.47 1.78 1.84 25.55 - 0.78
Other markets
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Gold ($) 1 892.60 0.77 - 0.82 - 2.86 9.09 29.13
Platinum ($) 907.00 1.91 5.10 - 4.02 17.18 3.54
Brent Oil ($) 42.78 - 1.72 0.78 - 4.85 46.56 - 31.41
Rand/USD 15.32 0.94 8.06 11.59 14.83 - 4.22
Rand/GBP 20.25 0.99 5.73 11.71 7.72 - 6.62
Rand/EUR 18.17 0.91 6.86 12.13 7.86 - 11.74
ALBI (R) 742.78 0.30 3.82 4.32 8.87 7.64
  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. US: Retail Sales MoM OCT
  2. EU: ECB President Lagarde Speech
  3. SA: OPEC+ JMMC Meeting

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 2.46 6.19 7.08 7.38 7.58 7.63
PSG Wealth Income FoF D 4.27 5.20 6.59 6.89 7.43 7.53
PSG Wealth Preserver FoF D 5.89 2.89 4.47 3.43 5.31 5.28
PSG Wealth Moderate FoF D 9.29 1.91 3.90 1.55 4.70 4.56
PSG Wealth Creator FoF D 17.37 2.80 4.59 0.11 4.36 4.22
PSG Wealth Global Preserver FF D - 6.70 7.70 9.39 - - -
PSG Wealth Global Moderate FF D - 0.46 12.19 12.55 6.96 8.89 7.07
PSG Wealth Global Flexible FF D 1.76 20.31 17.76 - - -
PSG Wealth Global Creator FF D 5.78 23.26 21.18 14.63 17.12 13.63
PSG Wealth Solutions ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Moderate FoF D 18.03 8.16 8.51 4.58 6.55 5.38
PSG Wealth Global Creator FoF D 25.34 17.84 16.87 11.82 14.38 11.79
PSG Wealth Global Preserver FoF (USD) D 9.72 2.76 4.78 2.96 3.96 4.69
PSG Wealth Global Flexible FoF (USD) D 20.56 15.89 14.01 9.91 12.36 10.76
PSG Wealth Solutions (£)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Preserver FoF (GBP) D 3.60 0.17 3.75 2.58 2.85 6.60
PSG Wealth Global Flexible FoF (GBP) D 12.10 13.13 12.56 9.52 10.37 12.79
PSG Asset Management
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Money Market A 2.11 5.62 6.44 6.73 6.95 7.00
PSG Income A 4.87 9.75 9.04 8.93 8.75 8.57
PSG Diversified Income 6.12 7.60 7.16 7.35 7.63 7.65
PSG Stable A 9.25 - 2.28 - 1.31 1.04 2.99 3.96
PSG Balanced A 15.58 - 6.62 - 6.77 - 3.74 - 0.05 1.87
PSG Flexible A 16.95 - 11.54 - 8.60 - 5.29 - 1.14 1.73
PSG SA Equity D 27.40 - 13.61 - 14.72 - 11.03 - -
PSG Equity A 19.14 - 11.75 - 11.96 - 8.41 - 3.26 0.35
PSG Global Flexible FF A 6.45 0.25 - 1.72 - 1.48 2.90 -
PSG Global Equity FF A 9.11 - 6.40 - 5.92 - 3.86 1.63 3.49
PSG Asset Management ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Global Flexible USD A 30.68 - 1.66 - 4.77 - 3.16 1.01 3.43
PSG Global Equity USD 33.36 - 6.74 - 8.02 - 4.95 0.16 2.79
  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

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 12.96 - 5.20 - 4.07 - 3.77 0.03 1.48
PSG Wealth SA Property Equity Portfolio 7.25 - 47.97 - 31.94 - 24.18 - 17.02 -
PSG Wealth Dividend Income Equity Portfolio 11.86 - 18.12 - 10.70 - 6.45 - 1.94 -
PSG Wealth Offshore Equity Portfolio (USD) 20.47 13.89 14.65 12.58 16.18 14.03
  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

company logo

Highlights

  • We feel that life assurers are likely to be under pressure from both the current macroeconomic environment and uncertainties about the impact of COVID-19 on operations.
  • Demand for insurance products will likely remain subdued and weak through 2021 with significant uncertainty around provisioning, credit quality, and the extent of relief provided by the insurance companies.
  • Due to large parts of life insurance assets being linked to the investment market, market movements remain the primary driver of investment returns; as most asset classes are currently under pressure, this has translated into lower valuations.
  • While the catalyst to unlock value is not yet evident, we believe that the already-low expectations currently priced into valuations translate into a potential return profile that is asymmetrical to the upside.
  • For more information about this sector, please contact your PSG Wealth adviser.


company logo

Highlights

  • Although the group is trading at a steep discount to itself and a 47% discount to our SOTP value, we believe that the market has mostly captured risks from UK operations due to Brexit, reinstated lockdowns, and volatility around African businesses.
  • As a result, we recommend an overweight position to investors with a high-risk tolerance only and stress that reversions toward long-term averages remain dependent on a medium-term recovery in profitability and normalisation in property fundamentals.
  • For more information about this counter, please contact your PSG Wealth adviser.


company logo

Highlights

  • The group is currently focussed on numerous initiatives to stabilise its operations, protect liquidity and strengthen its balance sheet.
  • We estimate that the local operations have access to sufficient liquidity to give it the flexibility to restructure its Australian operations.
  • However, the pandemic has resulted in a weak consumer environment, and the restructuring of the Australian operations has no easy solutions.
  • Currently, Woolworths is trading on a forward P/E multiple of 13.2 times relative to its five-year average of 14.3, which we feel fairly values the group.
  • For more information about this counter, please contact your PSG Wealth adviser.


Corporate actions

Date Company Share code Expectation
18 November 2020 AH-Vest Limited AHL Cash Dividend
18 November 2020 Exemplar REITail Limited EXP Cash Dividend
18 November 2020 Investec Australia Property Fund Limited IAP Interest Distribution
18 November 2020 Investec Bank (Mauritius) Limited IMRP7 Cash Dividend
18 November 2020 London Finance and Investment Group Plc LNF Cash Dividend
18 November 2020 MIX Telematics Limited MIX Cash Dividend
18 November 2020 Newfunds Govi ETF Portfolio NFGOVI Cash Distribution
18 November 2020 Spear REIT Limited SEA DRIPOption 1 - (Cash Dividend) Gross - ZAR0.2934465Less 20% Withholding Tax - ZAR0.0586893 Net - ZAR0.2347572Option 2 (Reinvestment)Reinvestment Price - ZAR4.4565535Default - Option 1 (Cash)
18 November 2020 Vivo Energy Plc VVO Cash Dividend
  1. The information above is to the best of our knowledge correct at the time of distribution but due to the nature thereof cannot be guaranteed.
  2. This document only contains general information and not the opinion of the distributor.

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Author
author

Adriaan Pask PhD

Chief Investment Officer


At PSG Wealth
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