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Rand pushes to a five-month high

15 July 2019

Rand pushes to a five-month high

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Market commentary

SA flag Icon
South Africa

The JSE ended flat on Friday, after tracking a rally in global markets, while gains were trimmed by a sell-off in Asia following disappointing interim results. The All Share closed up by 0.01%.

US flag Icon
United States

Wall Street’s main indexes traded higher on Friday extending the week’s solid run boosted by hopes of an interest rate cut by the US Federal Reserve (Fed) later this month. At 17h25, the Dow was trading 0.48% in the green.

EU flag Icon
Europe

European shares were marginally higher on Friday, supported by a stellar performance by financial and mining stocks, however, concerns over the impact of a prolonged US-China trade war trimmed gains. At 18h55, the pan-European STOXX 600 Index was 0.02% in the green.

HK flag Icon
Hong Kong

Hong Kong markets closed in the green on Friday as investors scrutinized a range of Chinese economic data to evaluate the state of the country’s economy while concerns over a deadlock in the US-Sino trade spat trimmed optimism in the market. At 19h05, the Hang Seng gained 0.19%.

Japan flag Icon
Japan

Japan’s Nikkei strengthened on Friday boosted by a better-than-expected performance by market heavyweight Fast Retailing. At the closing bell, the Nikkei had gained 0.20%.

Rand Icon
Rand

The rand surged to a five-month high on Friday supported by hopes of a Fed rate cut, with the market pricing in a 17.50% chance of a 50-basis-point cut later this month. At 17h50, the rand traded at R13.99 against the dollar.

Precious metals Icon
Precious metals

A weaker dollar and concerns over a slowdown in global growth boosted gold prices on Friday. At 18h00, spot gold was trading in the red at $1 408.90 an ounce.

Oil Icon
Oil

Oil prices peaked on Friday and recorded a weekly gain as production was disrupted in the Gulf of Mexico due to a tropical storm amid tensions in the Middle East. At 18h15, a barrel of Brent crude was trading at $67.27.


Market indicators

Local markets (R)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
ALSI 57 277.35 0.01 - 2.30 - 1.63 8.48 4.13
Gold mining 1 975.03 - 1.02 6.49 33.67 43.23 87.93
Basic minerals 32 769.92 0.46 - 2.85 - 3.79 15.54 20.73
Industrial index 77 746.10 - 0.37 - 1.94 - 0.44 9.32 - 2.72
Financial 41 363.49 0.29 - 2.45 - 1.63 0.46 3.39
Fin + Ind 30 7 737.76 - 0.15 - 2.11 - 0.83 6.22 - 0.77
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) 27 332.03 0.90 5.24 4.13 15.29 12.27
S&P 500 PR (USD) 3 013.77 0.47 4.82 4.17 17.28 9.89
NASDAQ (USD) 8 244.14 0.59 5.87 3.54 18.91 6.53
FT-100 (GBP) 7 505.97 - 0.05 2.08 2.01 11.24 2.48
Hang Seng (HKD) 28 471.62 0.14 5.13 - 2.81 9.45 3.55
Nikkei 225 (JPY) 21 685.90 0.20 2.87 - 0.61 7.72 - 0.16
MSCI World (USD) 6 433.44 0.34 3.79 - 1.63 14.37 5.90
Frankfurt (EUR) 5 505.49 - 0.07 1.71 2.69 13.19 - 1.36
Other markets
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Gold ($) 1 405.60 - 1.23 5.16 8.44 8.73 12.91
Platinum ($) 824.00 - 0.72 0.86 - 8.34 0.12 - 0.96
Brent Oil ($) 66.72 0.30 11.26 - 6.75 10.32 - 10.38
Rand/USD 13.96 -0.09 5.73 0.78 -1.43 -4.90
Rand/GBP 17.54 -0.28 5.42 4.75 0.85 -0.01
Rand/EUR 15.73 -0.06 5.41 1.08 -0.22 -1.36
ALBI (R) 684.17 - 0.55 2.44 2.98 6.62 11.04

  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. CN: GDP Growth Rate Q2
  2. RU: Industrial Production JUN

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 3.94 8.03 8.01 8.10 7.93 7.59
PSG Wealth Income FoF D 4.49 7.92 7.99 8.07 8.21 8.12
PSG Wealth Preserver FoF D 4.34 4.04 5.51 5.61 6.32 6.73
PSG Wealth Moderate FoF D 5.26 1.44 4.55 4.89 5.45 5.96
PSG Wealth Creator FoF D 4.28 - 0.24 3.79 4.50 3.74 3.93
PSG Wealth Global Moderate FF D 8.03 5.53 5.16 4.60 5.97 7.31
PSG Wealth Global Creator FF D 16.61 10.22 11.70 11.51 12.18 -
PSG Wealth Solutions ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Moderate FoF D 7.69 2.57 3.72 5.61 2.76 1.92
PSG Wealth Global Creator FoF D 16.15 6.97 10.23 12.43 8.74 7.47
PSG Wealth Global Preserver FoF (USD) D 5.66 5.28 3.23 4.32 4.60 3.39
PSG Wealth Global Flexible FoF (USD) D 10.06 5.79 8.18 11.13 8.88 6.42
PSG Wealth Solutions (£)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Preserver FoF (GBP) D 7.62 9.10 4.26 5.05 8.44 7.63
PSG Wealth Global Flexible FoF (GBP) D 12.88 11.90 9.08 11.56 13.06 12.31
PSG Asset Management
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Money Market A 3.58 7.30 7.35 7.45 7.30 7.10
PSG Income A 4.18 8.36 8.44 8.42 8.24 7.89
PSG Diversified Income 3.82 6.96 7.68 7.87 7.91 7.73
PSG Stable A - 0.27 0.46 4.42 5.46 5.61 6.21
PSG Balanced A - 3.79 - 5.92 0.92 3.84 3.74 5.20
PSG Flexible A - 3.63 - 5.34 0.97 4.39 4.47 5.91
PSG SA Equity D - 10.40 - 12.67 - 3.98 1.06 - -
PSG Equity A - 7.36 - 10.12 - 2.10 3.10 1.57 2.81
PSG Global Flexible FF A - 0.81 - 5.45 0.08 4.23 4.94 -
PSG Global Equity FF A - 1.21 - 7.26 0.17 5.33 4.93 5.75
PSG Asset Management ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Global Flexible USD A - 1.77 - 8.07 - 1.40 5.29 1.84 1.08
PSG Global Equity USD - 2.21 - 9.44 - 1.22 6.39 1.74 0.69
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 3.75 7.23 7.55 7.62 7.52 7.26
PSG Direct Low Equity - 0.55 - 0.28 3.76 5.06 5.14 5.80
PSG Direct Managed - 3.96 - 6.20 0.48 3.50 3.45 4.90
PSG Direct Aggressive - 4.27 - 7.02 - 0.39 3.65 3.48 -
PSG Direct Global Managed - 1.03 - 5.88 - 0.38 3.76 4.46 -
PSG Direct Global Aggressive - 1.28 - 7.01 - 0.31 4.45 4.47 -

  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 -2.84 -5.38 2.67 3.01 - -
PSG Wealth SA Property Equity Portfolio -0.96 -9.58 -5.72 -3.49 - -
PSG Wealth SA Dividend Income Equity Portfolio -2.98 -3.91 5.49 5.02 - -
PSG Wealth Offshore Equity Portfolio (USD) 12.53 12.49 12.98 14.38 - -
PSG Wealth Managed Volatility Equity Portfolio -4.98 -11.31 -3.87 - - -

  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 Neutral positioning for FSR SJ; click here to read the full report on our secure site.
  • FirstRand’s new initiatives are showing uptake and have typically displayed resilience in earnings and income during recessions.
  • It is important to point out that the impairment ratio is still below the group’s through-the-cycle threshold.


company logo

Highlights

  • We recommend an overweight positioning for CAT US; click here to read the full report on our secure site.
  • The company has increased dividends for the past 25 consecutive years (including the GFC of 2008) and it trades at a dividend yield of 2.8%.
  • Dividend growth is targeted to range in the high-single digits in each of the next four years, while management has indicated it will continue to do share buybacks as it is still creating value at this stage.


company logo

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.


Corporate actions

Date Company Share code Expectation
17 July 2019 Alexander Forbes Group Holdings Limited AFH Cash Dividend
17 July 2019 Alexander Forbes Group Holdings Limited AFH Special Cash Dividend
17 July 2019 Delta EMD Limited DTA Cash Dividend
17 July 2019 Delta EMD Limited DTA Liquidation Dividend
17 July 2019 Investec Bank Limited Redeemable Non-Participating Preference Shares IBRP1 Cash Dividend
17 July 2019 Lewis Group Limited LEW Cash Dividend
17 July 2019 Nictus Limited NCS Cash Dividend
17 July 2019 Primeserve Group Limited PMV Cash Dividend
17 July 2019 The Foschini Group Limited TFG 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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