The Ramaphosa Impact
Since the initial euphoria over President Ramaphosa’s election and inauguration, some of the excitement has worn off and the focus of the media has shifted back to South Africa’s many problems. Maybe we have forgotten that this new president is a consummate businessman in his own right and used to negotiating successfully at the highest level. He has recently stated that it was his intention to bring in $100bn of foreign
Sasol: Resistance Becomes Support
Two years ago we wrote an article in which we drew your attention to the fact that Sasol, following its precipitous fall in 2014, had entered a sideways market bounded by support at R360 and resistance at R492. In September 2016, we suggested in another article that: “It now looks, technically, as
US Economy and the Rand
The US Federal Reserve Bank’s (The Fed) decision to sell $20bn worth of bonds a month is a monetary policy decision aimed at reducing the size of the American money supply. When a government sells bonds it takes money out of the economy and replaces it with something that is not money (a bond) thereby reducing the money supply. Trading in government bonds by the central bank is known as “open market operations” and is a
Steinhoff Breaks Up At Last
When a blue chip, institutional share like Steinhoff falls heavily, there are always private investors looking to buy it at its much reduced price hoping to make a quick profit. But there is great danger in taking a position too early. Immediately after the Viceroy report was published, Steinhoff fell from around R55 to below 465c and hovered there for just over a week. Then it began to rally, reaching as [glossary_exclude]high[/glossary_exclude]
The S&P500 Revisited
Three months ago, on 6th April this year we wrote an article about the S&P500 and the correction up to that point. We suggested that strong support had been built by the four unsuccessful attempts to penetrate the 2581 level (the green arrows). We said that the bulls would take heart from this and drive the market higher, back towards the all-time
MSCI Emerging Markets Index
Together with about 22 other countries around the world, South Africa is regarded internationally as an “emerging market”. This means that investments in this country are seen as more risky than those in first world countries. That, in turn, means that we have to offer and pay a higher return to attract those investments. Our bench-mark government bond (the R186) is currently offering a return of close to 9% per annum.
Sasol Breaks Up
Two years ago in June 2016, we wrote an article about the fact that Sasol, since the collapse of the oil price, had entered a sideways market between resistance at R392 and support at R360. Sasol’s collapse was caused by the sharp fall in the oil price with the widespread exploitation of shale gas, especially in America. At the time about 60% of Sasol’s revenue came