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Rand flirts with R15/$ threshold

07 June 2019

Rand flirts with R15/$ threshold

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Market commentary

SA flag Icon
South Africa

The local bourse ended Thursday flat in light of the weak rand pulling retailers and banks down while miners and rand hedges countered the drop. At the end of trade, the All Share rose 0.03%.

US flag Icon
United States

US shares started Thursday on a positive note due to the potentially lower interest rates but remained cautious as US President Donald Trump fuelled fears around escalating the Chinese tariff war further. Shortly after the JSE closed, the Dow Jones was 0.32% up.

EU flag Icon
Europe

Despite the European Central Bank (ECB) keeping interest rates unchanged on Thursday as expected, most European markets only moved slightly due to disappointment that the ECB did not take a more dovish slant. The STOXX 600 closed 0.02% lower.

HK flag Icon
Hong Kong

The Hang Seng closed slightly higher on Thursday as positive sentiment about possible US rate cuts outweighed US-Sino trade war fears. At the end of trade, it was 0.27% in the green.

Japan flag Icon
Japan

A day of mixed trade left Japan’s Nikkei closing flat on Thursday as investors grew increasingly concerned about the US’s trade wars, opting for investments with domestic exposure. At the end of trade, the Nikkei was down 0.01%.

Rand Icon
Rand

The rand almost broke through the R15/$ barrier on Thursday, reaching an eight-month low, due to the unwavering pressure of poor economic data and local political uncertainty. At 21h50, the rand traded at R14.98 against the dollar.

Precious metals Icon
Precious metals

Bullion prices continued to climb on Thursday thanks to expectations around US rate cuts, despite some investors cashing in their recent gains. At 21h50, an ounce of spot gold cost $1 333.81.

Oil Icon
Oil

Oil prices surged on Thursday, recovering from an almost five-month low, due to a report indicating that the US might postpone implementing tariffs on Mexico. At 21h50, a barrel of Brent crude traded at $63.17


Market indicators

Local markets (R)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
ALSI 57 073.38 0.03 - 3.70 3.68 12.14 2.13
Gold mining 1 810.62 4.44 28.90 19.70 58.09 77.39
Basic minerals 32 271.70 1.55 - 1.26 2.12 23.51 18.01
Industrial index 77 755.17 1.06 - 4.23 5.80 11.63 - 3.44
Financial 41 426.88 0.49 - 5.16 1.30 3.05 - 0.61
Fin + Ind 30 7 742.37 0.87 - 4.53 4.26 8.63 - 2.52
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) 25 539.57 0.86 - 3.23 - 0.39 3.28 5.43
S&P 500 PR (USD) 2 826.15 0.83 - 3.82 1.82 5.76 4.89
NASDAQ (USD) 7 575.48 0.65 - 7.06 0.27 6.43 0.26
FT-100 (GBP) 7 220.22 0.08 - 1.64 1.93 6.77 - 1.85
Hang Seng (HKD) 26 965.28 0.27 - 6.56 - 5.88 4.79 - 10.28
Nikkei 225 (JPY) 20 774.04 - 0.01 - 6.67 - 3.03 - 2.34 - 6.25
MSCI World (USD) 6 084.43 0.88 - 3.46 1.30 5.56 0.85
Frankfurt (EUR) 5 348.46 - 0.23 - 2.72 3.15 10.56 - 6.83
Other markets
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Gold ($) 1 336.65 - 0.08 5.24 3.97 8.10 3.20
Platinum ($) 823.00 0.24 - 3.52 - 1.67 3.26 - 8.25
Brent Oil ($) 61.67 1.72 - 13.43 - 6.55 2.68 - 18.17
Rand/USD 15.03 - 1.13 - 4.58 - 4.15 - 7.01 - 18.13
Rand/GBP 19.08 - 1.19 - 2.10 - 1.90 - 6.39 - 11.68
Rand/EUR 16.93 - 1.46 - 5.28 - 4.48 - 5.99 - 12.87
ALBI (R) 664.59 - 0.26 0.28 1.86 5.88 8.29
  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. ZA: Foreign exchange reserves MAY
  1. DE: Balance of trade APR
  2. US: Non-farm payrolls MAY
  3. JPN: GDP growth rate q/q final Q1 (Monday 01h50)
  4. CN: Balance of trade MAY (Monday 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 3.95 7.99 8.03 8.11 7.89 7.55
PSG Wealth Income FoF D 4.40 7.66 7.77 8.10 8.15 8.08
PSG Wealth Preserver FoF D 4.89 5.01 5.81 5.17 6.22 6.89
PSG Wealth Moderate FoF D 5.83 2.97 4.87 3.95 5.20 6.16
PSG Wealth Creator FoF D 6.88 - 0.10 3.76 3.32 3.35 4.22
PSG Wealth Global Moderate FF D 9.29 14.14 9.15 2.63 5.30 8.07
PSG Wealth Global Creator FF D 9.81 17.54 14.06 8.31 10.59 -
PSG Wealth Solutions ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Moderate FoF D 3.22 - 1.26 1.71 3.99 1.41 1.30
PSG Wealth Global Creator FoF D 5.99 2.26 6.73 10.10 6.84 6.37
PSG Wealth Global Preserver FoF (USD) D 4.28 3.24 2.31 4.46 3.55 3.10
PSG Wealth Global Flexible FoF (USD) D 5.80 4.41 6.10 9.70 6.98 5.93
PSG Wealth Solutions (£)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Preserver FoF (GBP) D 4.43 6.87 3.05 7.58 7.12 6.86
PSG Wealth Global Flexible FoF (GBP) D 6.13 9.45 6.07 13.09 10.70 11.02
PSG Asset Management
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Money Market A 3.60 7.28 7.36 7.46 7.28 7.08
PSG Income A 4.20 8.23 8.25 8.53 8.17 7.86
PSG Diversified Income 3.52 6.61 7.33 7.70 7.75 7.63
PSG Stable A 0.37 1.26 4.77 5.35 5.64 6.46
PSG Balanced A - 2.91 - 3.93 2.17 3.66 3.83 5.77
PSG Flexible A - 1.93 - 3.51 2.48 4.22 4.62 6.56
PSG SA Equity D - 6.70 - 13.08 - 2.66 2.11 - -
PSG Equity A - 4.65 - 8.16 0.07 3.66 1.70 3.93
PSG Global Flexible FF A - 0.56 2.32 4.73 2.27 4.60 -
PSG Global Equity FF A - 2.18 - 0.11 4.69 3.26 4.35 6.71
PSG Asset Management ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Global Flexible USD A - 6.35 - 11.79 - 2.28 4.21 1.06 0.81
PSG Global Equity USD - 7.48 - 13.50 - 2.15 5.34 0.78 0.39
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 3.65 7.03 7.32 7.61 7.43 7.20
PSG Direct Low Equity - 0.02 0.60 4.19 4.93 5.16 6.05
PSG Direct Managed - 2.88 - 4.26 1.79 3.33 3.56 5.49
PSG Direct Aggressive - 2.58 - 3.93 1.95 3.35 3.52 -
PSG Direct Global Managed - 0.78 1.86 4.25 1.80 4.12 -
PSG Direct Global Aggressive - 1.80 0.34 4.24 2.43 3.97 -
  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 1.22 - 5.90 2.38 1.92 - -
PSG Wealth SA Property Equity Portfolio - 3.77 - 12.86 - 6.06 - 6.04 - -
PSG Wealth SA Dividend Income Equity Portfolio 2.53 - 4.33 4.86 4.74 - -
PSG Wealth Offshore Equity Portfolio (USD) 4.54 7.68 10.24 12.73 - -
PSG Wealth Managed Volatility Equity Portfolio - 0.89 - 10.56 - 3.09 - - -
  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

  • We recommend a neutral positioning for GRT SJ; click here to read the full report on our secure site.
  • Although the current distribution yield of 8.84% is enticing (well ahead of its long-term average and is guided to grow by 4.50% in the current year), locally, property fundamentals are deteriorating.
  • We feel that weak property fundamentals are fairly reflected in the valuation and would recommend a neutral position relative to the benchmark.


company logo

Highlights

  • We recommend an overweight positioning for MMI SJ; click here to read the full report on our secure site.
  • Strong growth was seen in Momentum Life, which constitutes a third of the total earnings, due to management tightening expenses, improving productivity and enhancing the product offering.
  • The improved earnings are likely to support higher dividend payments, which are likely to underpin the share price.


company logo

Highlights

  • We recommend an underweight positioning for HEIA NA; click here to read the full report on our secure site.
  • New product innovations such as low and non-alcoholic extensions to the Heineken brand is a growth prospect, although the threat of it cannibalising other brands within the portfolio is present.
  • We believe the share is fully valued at current levels, trading at a forward P/E of 20.83 times, one standard deviation away from its average forward P/E of 19.47 times.


Corporate actions

Date Company Share code Expectation
12 June 2019 Afrimat Limited AFT Cash Dividend
12 June 2019 Balwin Properties Limited BWN Cash Dividend
12 June 2019 Combined Motor Holdings Limited CMH Cash Dividend
12 June 2019 Cartrack Holdings Limited CTK Cash Dividend
12 June 2019 CastleView Property Fund Ltd (REIT) CVW Cash Dividend
12 June 2019 Dipula Income Fund Limited "A" Shares DIA Cash Dividend
12 June 2019 Dipula Income Fund Limited "B" Shares DIB Cash Dividend
12 June 2019 eMedia Holdings Limited EMH Cash Dividend
12 June 2019 eMedia Holdings Limited "N" Ordinary Shares EMN Cash Dividend
12 June 2019 Exemplar REITail Limited (REIT) EXP Cash Dividend
12 June 2019 Hospitality Property Fund Ltd (REIT) HPB Cash Dividend
12 June 2019 Hosken Passenger Logistics& Rail Ltd HPR Cash Dividend
12 June 2019 Investec Property Fund Limited (REIT) IPF DRIP
Option 1 - (Cash Dividend) Gross - ZAR0.7350878Less 20% DWT - ZAR0.14701756Net - ZAR0.58807024
Option 2 (Reinvestment)Reinvestment Price - To be announced
Default - Option 2 (Cash Dividend))
12 June 2019 MediClinic International Plc MEI Cash Dividend
12 June 2019 Newpark REIT Ltd NRL Cash Dividend
12 June 2019 Nvest Financial Holdings Ltd NVE Cash Dividend
12 June 2019 Tradehold Limited TDH DRIP
Option 1 - (Cash Dividend) Gross - ZAR0.55Less 20% DWT - ZAR0.11Net - ZAR0.44
Option 2 (Reinvestment)Reinvestment Price - To be announced
Default - Option 1
12 June 2019 Tsogo Sun Holdings Ltd TSH Cash Dividend
12 June 2019 Wilderness Holdings Ltd WIL Voluntary Offer
12 June 2019 Telkom SA Limited TKG 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


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