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Global markets rise on optimism over Chinese stimulus

20 August 2019

Global markets rise on optimism over Chinese stimulus

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Market commentary

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South Africa

The JSE kicked off the week on a positive note after China slashed interest rates to counter slowing growth, while US President Donald Trump said he was still optimistic that Beijing and Washington will soon reach a trade consensus. Shortly after the closing bell, the All Share was up by 0.95% on Monday.

US flag Icon
United States

News of an interest rate cut in China boosted Wall Street on Monday, and restored faith that major economies are prepared to implement the necessary stimulus to counter slowing growth. The Dow was up 1.07% just after the JSE closed.

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Europe

European markets tracked a global rally on Monday on the back of lower interest rates in China, while bond yields recovered on improved global sentiment. Just after 20h00, the FTSE 100 gained 1.02% and the French CAC 40 was up by 1.34%.

HK flag Icon
Hong Kong

Hong Kong stocks started the week on a solid note, reaching a two-month high after Beijing enforced measures to boost slowing economic growth. The Hang Seng Index ended up by 2.17% on Monday.

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Japan

While market participants were mostly cautious on the back of simmering US-China trade tensions, Japanese shares ended higher on news of interest rate cuts in Beijing. The Nikkei Index closed up 0.71%.

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Rand

The rand lost its footing against the dollar on Monday as a mixed bag of global risk factors weighed on sentiment. Just after the JSE closed, the rand weakened to R15.44/$.

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Precious metals

Gold prices fell on Monday amid a stronger dollar environment and a general rally in global equities. At 20h15, an ounce of spot gold traded at $1 497.85.

Oil Icon
Oil

Gaining over 1%, oil prices were set for a day of gains on Monday as buyers cheered the idea that major economies would take steps to boost slowing growth. At 20h30, a barrel of Brent crude traded at $59.78.


Market indicators

Local markets (R)
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
ALSI 54 386.31 0.95 - 6.43 - 2.73 0.32 - 0.69
Gold mining 2 394.23 0.53 13.56 78.98 48.97 158.27
Basic minerals 31 089.38 2.02 - 6.65 - 0.18 - 0.67 12.26
Industrial index 75 886.78 0.81 - 4.17 0.33 6.02 - 3.52
Financial 37 059.28 0.05 - 10.86 - 11.37 - 9.35 - 7.10
Fin + Ind 30 7 349.44 0.58 - 6.34 - 3.61 0.72 - 4.64
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) 26 135.79 0.98 - 3.47 2.12 2.19 4.29
S&P 500 PR (USD) 2 923.65 1.22 - 1.59 2.76 6.26 4.68
NASDAQ (USD) 8 002.81 1.36 - 1.64 2.66 7.52 3.51
FT-100 (GBP) 7 189.65 1.02 - 3.36 - 0.85 3.29 - 0.51
Hang Seng (HKD) 26 291.84 2.17 - 8.47 - 3.99 - 4.40 0.08
Nikkei 225 (JPY) 20 563.16 0.71 - 4.20 - 3.00 - 0.51 - 5.68
MSCI World (USD) 6 209.49 1.11 - 2.70 - 11.37 3.92 1.70
Frankfurt (EUR) 5 230.15 1.32 - 4.44 - 4.28 3.59 - 4.06
Other markets
Index Current level 1 Day move 1 Month move 3 Month move 6 Month move 1 Year move
Gold ($) 1 499.35 - 0.64 4.34 16.61 12.77 27.42
Platinum ($) 844.00 1.20 - 1.52 2.18 3.81 7.93
Brent Oil ($) 59.74 1.88 - 4.37 - 17.27 - 10.10 - 16.83
Rand/USD 15.42 -1.00 -11.34 -6.60 -10.87 -5.24
Rand/GBP 18.71 -0.79 -7.72 -2.16 -2.89 -0.14
Rand/EUR 17.09 -0.97 -9.60 -6.35 -8.22 -2.05
ALBI (R) 672.88 - 0.37 - 2.58 1.29 5.15 10.38
  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. EA: Construction Output JUN
  2. KR: PPI JUL

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 3.96 8.05 7.99 8.07 7.96 7.69
PSG Wealth Income FoF D 3.96 7.55 7.61 7.88 8.05 8.11
PSG Wealth Preserver FoF D 1.57 1.67 4.12 5.08 5.64 6.55
PSG Wealth Moderate FoF D - 0.02 - 2.52 1.85 3.57 4.35 5.46
PSG Wealth Creator FoF D - 3.90 - 6.24 - 1.18 1.40 2.34 2.62
PSG Wealth Global Moderate FF D 9.25 4.29 8.74 8.39 6.80 9.17
PSG Wealth Global Creator FF D 12.91 7.23 15.20 14.84 12.25 -
PSG Wealth Solutions ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Moderate FoF D 1.67 0.50 1.52 3.65 2.35 1.57
PSG Wealth Global Creator FoF D 4.67 3.46 7.20 9.42 7.38 6.79
PSG Wealth Global Preserver FoF (USD) D 2.40 3.68 2.03 3.09 4.16 3.21
PSG Wealth Global Flexible FoF (USD) D 2.00 3.04 5.47 8.23 7.58 5.93
PSG Wealth Solutions (£)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Wealth Global Preserver FoF (GBP) D 6.72 6.53 4.22 4.68 8.82 7.61
PSG Wealth Global Flexible FoF (GBP) D 7.96 7.62 7.77 9.70 12.70 11.87
PSG Asset Management
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Money Market A 3.57 7.30 7.34 7.45 7.32 7.13
PSG Income A 4.07 8.35 8.18 8.31 8.25 7.90
PSG Diversified Income 3.15 5.81 6.79 7.34 7.62 7.59
PSG Stable A - 3.22 - 3.49 1.84 3.74 4.73 5.63
PSG Balanced A - 8.57 - 12.01 - 3.04 0.90 2.40 4.25
PSG Flexible A - 8.56 - 10.94 - 2.40 1.58 3.41 5.13
PSG SA Equity D - 15.60 - 19.48 - 10.34 - 4.44 - -
PSG Equity A - 13.28 - 17.45 - 6.82 - 0.95 0.44 1.57
PSG Global Flexible FF A - 6.33 - 12.10 - 0.06 4.95 4.17 -
PSG Global Equity FF A - 9.04 - 15.44 - 0.85 5.00 3.85 5.84
PSG Asset Management ($)
Fund 6 Month move 1 Year move 2 Year move 3 Year move 4 Year move 5 Year move
PSG Global Flexible USD A - 12.93 - 14.14 - 6.39 0.61 0.20 - 0.36
PSG Global Equity USD - 15.04 - 16.71 - 6.90 0.91 - 0.02 - 0.88
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 3.44 6.80 7.09 7.37 7.42 7.21
PSG Direct Low Equity - 3.52 - 4.26 1.17 3.29 4.27 5.22
PSG Direct Managed - 8.78 - 12.14 - 3.32 0.61 2.19 4.00
PSG Direct Aggressive - 9.63 - 13.38 - 3.47 1.23 2.46 -
PSG Direct Global Managed - 6.54 - 12.50 - 0.51 4.47 3.70 -
PSG Direct Global Aggressive - 8.25 - 14.59 - 1.00 4.51 3.51 -
  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 -7.72 -11.59 -3.58 -0.85 - -
PSG Wealth SA Property Equity Portfolio -10.85 -14.06 -9.59 -6.08 - -
PSG Wealth SA Dividend Income Equity Portfolio -11.23 -13.23 -2.23 -0.42 - -
PSG Wealth Offshore Equity Portfolio (USD) 4.60 5.88 10.54 12.03 - -
PSG Wealth Managed Volatility Equity Portfolio -10.12 -17.04 -7.39 -5.37 - -
  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 AVI SJ is neutral; click here to read the full report on our secure site.
  • AVI is a high-quality food producer with a strong balance sheet and sound cash generation.
  • Earnings and operating margins have come under pressure lately due to sales volume weakness due to constrained consumer spending and consumers trading down on premium products.


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Highlights

  • Our recommendation for HMN SJ is underweight; click here to read the full report on our secure site.
  • Hammerson’s direct property portfolio is not diversified across sectors as the portfolio consists of retail assets only. However, it is diversified geographically with flagship destinations in the UK, France and Ireland.
  • The group’s dividend yield is trading above its long-term average and is well above the yield offered by its peers.


company logo

Highlights

  • Our recommendation for ITU SJ is underweight; click here to read the full report on our secure site.
  • Intu’s direct property portfolio is undiversified across sectors as the portfolio consists of retail assets only and, geographically, the majority of the portfolio is held in the UK.
  • In 2018, the demand for prime shopping centres has significantly fallen due to the uncertainty of Brexit, the structural change in retail and the higher-than-normal level of administrations, and company-voluntary arrangements.


Corporate actions

Date Company Share code Expectation
21 August 2019 FirstRand Limited Non-Cumulative, Variable Rate, Non-Redeemable B Preference Shares FSRP Cash Dividend
21 August 2019 Investec Bank Ltd Credit-Linked Redeemable Cumulative Non_Participating Unsecured Preference Shares IBRP4 Cash Dividend
21 August 2019 Investec Bank (Mauritius) Limited IMRP3 Cash Dividend
21 August 2019 Investec Bank (Mauritius) Limited IMRP6 Cash Dividend
21 August 2019 Liberty two Degrees L2D Cash Dividend
21 August 2019 Mix Telematics Limited MIX Cash Dividend
21 August 2019 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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