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Investors awaiting local GDP growth rate

08 September 2020

Investors awaiting local GDP growth rate

Daily Investment Update

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Market commentary

SA flag Icon
South Africa

The JSE closed 0.97% higher on Monday, as investors waited for direction from GDP growth rate numbers scheduled to be released this morning and fresh stimulus measures expected from the European Central Bank (ECB) at their policy meeting this Thursday.

US flag Icon
United States

Wall Street was closed on Monday for Labour Day.

EU flag Icon
Europe

A rally in US technology stocks and hopes for COVID-19 vaccines boosted European markets on Monday. The FTSE 100 closed up by 2.39%.

HK flag Icon
Hong Kong

The Hang Seng fell 0.35% on Monday as the proposed blacklisting of Semiconductor Manufacturing International Corporation (SMIC), China's largest chipmaker, by the US weighed on investor sentiment.

Japan flag Icon
Japan

The Nikkei dropped 0.50% on Monday after investors took profits following a rally in technology shares in the US.

Rand Icon
Rand

The rand traded in the R16.73/$ range at 20h30 on Monday as investors waited to see what local GDP growth rate data would show on Tuesday.

Precious metals Icon
Precious metals

An ounce of gold traded at $1 928.46 at 20h30 on Monday, after resurging fears of COVID-19 caused the greenback to strengthen.

Oil Icon
Oil

Oil prices fell to $41.77 a barrel on Monday at 20h30 as Saudi Arabia confirmed lower prices for supplies in Asia.


Market indicators

Local markets (R)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
ALSI 54 400.28 0.97 - 3.70 - 0.01 6.37 1.13
Gold mining 5 462.82 2.94 - 12.02 47.57 62.70 128.97
Basic minerals 40 000.42 2.27 - 4.52 13.25 31.81 33.34
Industrial index 76 315.47 0.12 - 2.89 - 2.68 5.12 0.18
Financial 24 413.65 0.46 - 4.00 - 16.16 - 24.29 - 33.26
Fin + Ind 30 6 494.43 0.21 - 3.18 - 6.57 - 4.61 - 11.55
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) 28 133.31 - 0.56 5.24 7.64 5.15 9.32
S&P 500 PR (USD) 3 426.96 - 0.81 3.85 10.58 10.57 18.94
NASDAQ (USD) 11 313.13 - 1.26 3.52 17.89 26.06 43.24
FT-100 (GBP) 5 937.40 2.39 - 1.01 - 7.47 - 6.75 - 15.64
Hang Seng (HKD) 24 589.65 - 0.35 0.64 0.96 - 3.60 - 4.69
Nikkei 225 (JPY) 23 089.95 - 0.50 3.45 1.15 12.49 11.20
MSCI World (USD) 7 139.89 0.36 2.36 6.63 13.07 12.39
Frankfurt (EUR) 5 675.42 2.01 3.36 1.97 13.50 7.45
Other markets
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Gold ($) 1 928.40 - 0.47 - 6.46 12.80 14.31 28.14
Platinum ($) 906.00 0.11 - 6.98 8.50 4.02 - 3.62
Brent Oil ($) 42.01 - 1.52 - 5.38 - 0.69 - 7.20 - 31.74
Rand/USD 16.75 - 0.96 4.97 - 0.35 - 2.23 - 13.22
Rand/GBP 22.01 - 0.26 4.58 - 3.96 - 4.79 - 21.16
Rand/EUR 19.78 - 0.76 4.48 - 4.44 - 6.89 - 21.26
ALBI (R) 717.31 0.20 1.45 1.11 1.36 4.08
  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. GDP growth rate Q2
  2. SACCI Business Confidence AUG
  1. EA: GDP growth rate YoY 3rd Est Q2
  2. EA: Employment change Final Q2
  3. US: NFIB Business Optimism Index AUG
  4. US: IBD/TIPP Economic optimism SEP

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 3.01 6.85 7.45 7.61 7.77 7.74
PSG Wealth Income FoF D 1.85 5.27 6.39 6.88 7.30 7.55
PSG Wealth Preserver FoF D 2.06 3.82 2.09 4.21 4.59 5.46
PSG Wealth Moderate FoF D 2.50 2.87 - 0.81 2.50 3.26 4.52
PSG Wealth Creator FoF D 2.16 2.44 - 2.79 0.47 1.87 3.35
PSG Wealth Global Preserver FF D 10.44 15.23 8.26 - - -
PSG Wealth Global Moderate FF D 16.02 21.66 9.26 13.05 9.14 9.08
PSG Wealth Global Flexible FF D 22.61 30.94 14.48 - - -
PSG Wealth Global Creator FF D 25.56 35.23 16.61 21.94 17.24 16.39
PSG Wealth Solutions ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Moderate FoF D 4.67 7.51 4.24 3.79 5.05 4.89
PSG Wealth Global Creator FoF D 13.45 18.26 10.32 11.21 12.23 11.55
PSG Wealth Global Preserver FoF (USD) D - 0.04 2.05 3.22 2.21 3.19 4.66
PSG Wealth Global Flexible FoF (USD) D 10.66 15.61 9.02 9.15 10.59 10.76
PSG Wealth Solutions (£)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Preserver FoF (GBP) D - 2.68 - 4.45 1.53 1.43 3.00 6.59
PSG Wealth Global Flexible FoF (GBP) D 7.52 6.88 7.49 7.96 9.88 12.78
PSG Asset Management
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Money Market A 2.68 6.21 6.76 6.95 7.13 7.11
PSG Income A 5.76 9.68 9.11 8.66 8.77 8.55
PSG Diversified Income 3.86 6.73 6.44 6.91 7.38 7.52
PSG Stable A - 1.95 - 2.07 - 3.21 0.62 2.31 3.52
PSG Balanced A - 3.29 - 6.33 - 10.41 - 4.23 - 1.01 0.89
PSG Flexible A - 7.04 - 12.23 - 12.65 - 5.82 - 2.13 0.41
PSG SA Equity D - 8.39 - 17.55 - 19.85 - 13.64 - -
PSG Equity A - 6.80 - 12.20 - 16.57 - 9.03 - 3.86 - 1.68
PSG Global Flexible FF A 10.96 10.51 - 4.44 3.52 3.64 -
PSG Global Equity FF A 5.54 3.98 - 8.99 0.98 2.20 4.13
PSG Asset Management ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Global Flexible USD A 0.25 - 2.91 - 8.28 - 4.77 - 0.03 1.80
PSG Global Equity USD - 3.86 - 7.73 - 11.94 - 6.60 - 1.05 1.02
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 4.50 7.73 7.38 7.34 7.59 7.52
PSG Direct Low Equity - 1.26 - 1.72 - 3.51 0.26 2.07 3.24
PSG Direct Managed - 4.44 - 8.24 - 11.37 - 5.05 - 1.73 0.32
PSG Direct Aggressive - 3.54 - 8.10 - 12.39 - 5.13 - 1.74 -
PSG Direct Global Managed 10.70 10.01 - 4.88 3.05 3.17 -
PSG Direct Global Aggressive 7.35 5.96 - 7.71 1.49 2.30 -
  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 - 6.70 - 9.52 - 11.57 - 5.90 - 3.04 0.08
PSG Wealth SA Property Equity Portfolio - 37.63 - 45.94 - 32.32 - 24.22 - 17.69 -
PSG Wealth Income Growth Equity Portfolio - 17.29 - 21.73 - 18.23 - 9.31 - 4.99 -
PSG Wealth Offshore Equity Portfolio (USD) 8.10 16.44 11.58 13.08 14.11 14.13
  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 an overweight position for N91 LN, Click here to read the full report on our secure site or log in to myBase.
  • Sixty per cent of group earnings comes from outside of SA, providing protection against idiosyncratic risks but does expose investors to exchange rate translation risks.
  • On a P/E basis, we estimate that the group is trading slightly ahead of its European peers and at a slight discount to Schroders, the only peer with a similar emerging market (EM) presence.
  • The group is trading at the lower end of its European peers in terms of market capital to assets under management (AUM).
  • Given its historically strong net client cash flow (NCCF), we feel the current valuation multiples do not fully capture the fundamentals of the group.


company logo

Highlights

  • We recommend an underweight position for BAM US, Click here to read the full report on our secure site or log in to myBase.
  • The group’s plan to significantly develop retail property and land comes at a time where the real estate sector has seen significant downside following the spread of COVID-19 as businesses are forced to close their doors and people to stay inside.
  • Real estate constitutes about 25% of our intrinsic value and around 35% of group operating income; thus, a slowdown in real estate will have a material impact on earnings for the group.
  • The current price appears undervalued; however, we feel that that the near-term downside risks from COVID-19 on the real estate operations outweigh any potential near-term rerating towards the implied value per share.


company logo

Highlights

  • We recommend a neutral position for both Naspers and Prosus. Click here to read the full report on our secure site or log in to myBase.
  • Despite the regulatory and political risks that come with investing in Chinese stocks, we acknowledge that, to a large extent, Prosus and Naspers provide an alternative risk and reward profile due to the exposure to structural growth trends, which are not available through alternative local counters.
  • Naspers and Prosus trade at discounts of 23% and 13% respectively.
  • Given that management is determined to reduce the discounts over time, we suspect there will eventually be large value unlock for shareholders.
  • The share price for both Naspers and Prosus moves with a fairly high correlation to the USD/ZAR exchange rate.


Corporate actions

Date Company Share code Expectation
09 September 2020 Gold Fields Limited GFI Cash Dividend
09 September 2020 MultiChoice South Africa Holdings Limited MCG Cash Dividend
09 September 2020 NEPI Rockcastle Plc NRP Capitalisation Issue
09 September 2020 Peregrine Holdings Limited PGR General Offer
09 September 2020 Royal Bafokeng Platinum Limited RBPCB Interest Payment
09 September 2020 South32 Limited S32 Cash Dividend
09 September 2020 Standard Bank Group Limited 6.5 percent Cumulative Preference Shares SBKP Cash Dividend
09 September 2020 Standard Bank Group Limited Non-Redeemable Non-Participating Second Preference Shares SBPP Cash Dividend
09 September 2020 Tradehold Limited Cumulative Redeemable "B" Preference Shares TDHBP Cash Dividend
09 September 2020 Tower Property Fund Limited (REIT) TWR Cash Dividend
09 September 2020 UBS Warrants UBGPAA Interest Payment
  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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