JSEDirect with Simon Brown

  China in trouble as economic data keeps on disappointing? Chinese data keeps disappointing, every since the -7.5% export data from April. Expected was a strong rebound after they lifted zero-covid restrictions. But not happening. Just this week; Among 70 Chinese cities, 49 saw a fall in new home prices month-on-month in July from 38 cities the previous month. China suspends youth unemployment da...

  Aspen looking cheap? Aspen (JSE code: APN) announces a acquisition in Latin America for US$290m on a price/sales of ±3x and PE of ±5x. This is a classic Stephen Saad sort of deal. Strong cash generation to pay down the debt. After having gone quiet when the balance sheet case under serious pressure (with debt of ±R50billion) Aspen is back? Chart looking good for a break higher. Forward PE of ±12...

  Central bakers have very few tools to achieve their mandates around inflation (and in some cases also protecting a currency and aiding GDP growth). Interest rates have a blunt lagged effect and their only other tool is what they say and we need to understand this central banker speak. Last week it was the South African Reserve Bank MPC rate announcement that left prime unchanged for the first ti...

As expected Local CPI for June came in at 5.4%, lowest in twenty months and well within the 3%-6% target range from the South African Reserve Bank. Yes base effect as June last year was the first +7% inflation print of this cycle.  When do we start talking rate cuts? Truthfully not yet, a pause would be nice eve as the gov always targets 4.5% not the range. Simon Shares MPC is Thursday, I expect n...

Simon Shares US inflation for June was 3.0%, expected was 3.1% and previous 4.0%. Next FOMC meeting is 25/26 July. I think they still do a 0.25% rate hike, but then maybe pause for good, well until cuts start next year. Nasdaq100 special rebalance to cut the 'Magnificent Seven' to "address over concentration in the index by redistributing the weights." Apple, Amazon, Alphabet, Meta, Microsoft, Nvi...

Two-pot system is confirmed, here all the details Starts 1 March 2024 All future reg28 and pension contributions will be split into two pots One third savings Two thirds investments You can withdraw the savings component before retirement Tax still payable Existing funds will convert automatically into the new two-pot system Of existing funds R25,000 will be transferred into the savings pot Concer...

SA Inc watch list. Building a list of stocks that are cheap, very cheap, and could give good return n the next year or three. Criteria; Must be profitable, so positive PE ratio Must be cheap, so PE below 8x Small as in market cap under R8billion No REITs Using Koyfin I get 46 stocks including REITs and detail them in the podcast. I'll create a watchlist on Google docs and share that link in time....

Local CPI 6.3% for May (lowest since April 2022) from 6.8% in April and vs expected 6.5%. A very good number and we should see June below 6% as June last year was the first +7% in this cycle at 7.4%. Simple base effect should put some serious pressure on inflation over the next few months. So is inflation largely over locally? Probably. Can we start talking about when the MPC starts cutting rates?...

dd Disappearing dividends Just this week Spar (JSE code: SPP), MultiChoice (JSE code: MCG) and Telkom (JSE code:TKG) have all cut dividend to zero. We had big dividend payer Coronation (JSE code: CML) drop theirs to provision for the SARS fine and historically good dividend payer Pick n Pay (JSE code: PIK) reduce theirs. This shows the pain that companies are experiencing, not all, but certainly s...

Simon Shares SEC sues Binance and CEO for U.S. securities violations. SEC Charges Coinbase for Operating as an Unregistered Securities Exchange, Broker, and Clearing Agency. First quarter GDP was 0.4% and we avoid a technical recession. Pepkor (JSE code: PPH) price slide. Tigerbrands (JSE code: TBS) horror results. Oceana (JSE code: OCE) results knock it out the park. Sun City visit. Excellent res...

Simon Shares MPC raised rates by 0.5% makes prime 11.75%, highest since 2009. The aim I suspect was to protect the rand, and that totally did not work as the currency hit its worst ever levels. Where will the rand go next? Does it ever strengthen again? RSA Retail Bond rates reset this morning and I expect the 5-year fixed to potentially increase by a full 15% and the CPI linked also reset and I a...

Simon Shares Bond ETFs yielding ±10%. That's chunky and they can go in a tax-free account. New INCOME ETF from CoreShares. Purple Group* (JSE code: PPE) rights issue. If you held the share yesterday at close on Tuesday 23 May you will see PPEN in your account. 10.20567 for every 100 Purple shares you held. Each PPEN (letter of allocation or LOC as some are calling it) entitles you to buy 1 new Pur...

Simon Shares I have been talking about a cracking (broken?) consumer for a few months now. Two recent surveys show exactly this data. BankservAfrica's five-year review of Take-home Pay and Private Pensions in South Africa for February 2018 – February 2023 "The average nominal salary Take-home Pay Index, increased from R12,573 to R15,438, +22.8%." But CPI was 26.6% and take home pay had kept track...

Simon Shares Transaction Capital (JSE code: TCP) results where pretty much as expected. Management have essentially thrown the kitchen sink at everything. H2 will be tough but likely a little better. FY24 a clean slate. But market does not agree with me. Nutun doing good WeBuyCars under pressure, no surprise, consumer cracking SA Taxi real ugly, but as detailed in trading update US unemployment 3....

Simon Shares Implats (JSE code: IMP) trading update saw production down and costs up. That's squeezing margins and going to hurt. Kumba (JSE code: KIO) nice boost in production, but iron ore prices are falling. Will hurt Afrimat (JSE code: AFT) as well. Combined Motor Holdings* (JSE code: CMH) results sees them on a PE of under 5x and DY of ±13%. But return will be mostly from dividends, ±650c ove...

Simon Shares Coronation* (JSE code: CML) trading update, aside from the massive SARS judgement (and hence no dividend), not bad. But not yet time for buying as sellers persist. Purple Group* (JSE code: PPE) results saw a loss for the six months ending February 2022. But lots of extra one off expenses (expected for a growth business) and a tough market and they still have excellent growth potential...

Simon Shares Local CPI 7.1% for March up from 7.0% in February. Expected was 6.9%. Core inflation 5.2% vs expectations of 5.1%. Rates higher for longer. Reviewing Minister Pravin Gordhan's portfolio . Too many stocks, why not more ETFs? Platinum at all-time highs in rands. This as it trades at more than 50% off the all-time US$ highs from 2008. Still long all my index trades . Time to sell Capitec...

Simon Shares US inflation for March at 5.0%, better then expected and initial response form markets was to jump higher. Big wait now is for first week of May and the next FOMC rate decision. Current open trading positions, long everything My 7/21 trading system has me long all the indices I trade as below; Nasdaq 22Mar23 @ 12,740 S&P500 21Mar23 @ 4,056 Euro Stoxx 50 03Apr23 @ 4,317 ASX200 05Apr23...

Simon Shares Combined Motor Holdings* (JSE code: CMH) strong trading update puts the stock on a PE of under 5x and a dividend yield of ±15%. A great well run company, but what will get the price moving higher or do we just live off dividends? * I hold ungeared positions. Strong first quarter returns Q1 2023 return[/caption] Top40 stocks, top and bottom performers pic.twitter.com/zwZlJkRpwX — Simon...

Simon Shares MPC announcement Thursday. Purple Group* (JSE code: PPE) git the 120c bottom of the range, but has suddenly rallied. Steinhoff (JSE code: SNH), we now know what as the "Board agrees on a radical draft plan to enter into an insolvency process with creditors". The problem with dividends - they not tax efficient. They are great But tax. Dividend Withholding Tax (DWT) is 20%. The maximum...

Simon Shares Federal Reserve FOMC raises 0.25% and the market drops as Fed says almost at the top. Local CPI comes in slightly higher at 7.0%. MPC meets next week, hold on rates or another +0.25%? Credit Suisse 'sold' to UBS. Steinhoff (JSE code: SNH) votes against the debt deal, now what? Bankruptcy surely? Transaction Capital (JSE codeL TCP) bounces, where's the value?

Simon Shares Silicon Valley Bank collapse, does this put a pause on US rate increases? FOMC next Tuesday/Wednesday. "Moody's cuts outlook on U.S. banking system to negative, citing 'rapidly deteriorating operating environment'" Miss expectations and get slammed Transaction Capital Absa MTN Multichoice Hold winners, ditch laggers. Sun International (JSE code: SUI) vs. City Lodge (JSE code: CLH). ff...

Simon Shares The local Q4 GDP came in at -1.3%, worse than expected -0.4% and shows the real pain of load shedding and Transnet issues. Q1 2023 not expected to be any better. Every set of results mentions load shedding and retailers are spending ±R1billion a year on diesel. Rand is looking weak, very weak. Grindrod (JSE code: GND) had good results and are clearly benefiting from the failure of Tra...

Simon Shares Budget 2023 show, audio is fixed Solar as a service Retail Savings Bonds five-year fixed now at 10.5% Satrix takes over most Absa ETFs City Lodge* (JSE code: CLH) results Stale bulls Dividend of 5c Occupancies at 57% Debt gone Cater for business, who are Zooming more Overall a bit light Spur (JSE code: SUR) results vs. Famous Brands (JSE code: FBR). * I hold ungeared positions.

Budget 2023 Pieter Janse van Rensburg ~ AJM Tax Tony Leon ~ former leader of the opposition & ambassador Lesego Majatladi ~ Stay Latatude Simon Brown Great insights into the budget, who should be our finance minister and even the Coronation* (JSE code: CML) Con Court appeal against the SARS judgement.