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The market is expected to remain subdued with more and more commentators forecasting lower returns due to lacklustre economic growth, an expected change in interest rates and a weaker rand.
The week that was
Most shares ended the week at similar levels than a week ago after the JSE strengthened on Thursday and Friday to make up for losses at the beginning of the week.
Shares of international companies and exporters have, once again, advanced quite strong due to the decline in the rand which is at its lowest level in nearly 5 years.
The rand hit R10.58/$ mid-week, but recovered slightly to R10.32/$ on Friday as international investors continue to sell SA equities in favour of American and European markets.
The exodus of international funds led to a decline in the rand to such an extend that selling pressure were outweighed by the benefits of a weaker currency on asset prices and foreign income.
Commodity shares led the market higher with shares such as BHP Billiton [JSE:BIL], Anglo [JSE:AGL] and Sasol [JSE:SOL] showing quite large increases.
Naspers [JSE:NPN] increased to a new high of above R1000 per share due to the weaker rand and continued strength in the share price of its interest in the Tencent, which owns the largest internet portal in the lucrative Chinese market. The Tencent interest comprises some 90% of Naspers' market capitalisation.
The week ahead
Financial shares remained strong and amongst industrial companies the shares of Nampak [JSE:NPK], Bidvest [JSE:BVT] and Adcock-Ingram [JSE:AIP] continued to attract attention last week.
Bidvest and Adcock will continue to be in the news in coming weeks as the battle for control of Adcock between Bidvest and the Chilean CFR Pharmaceutical continues.
Adcock has started an advertising campaign to inform shareholders about the proposed transaction and remind them of their right to vote for or against the offer by CFR.
It will be interesting to see if Bidvest will up its cash offer of R70 per share to match CFR Pharmaceutical's offer of a mixture of cash and CFR shares valued at R75 per Adcock share.
The real winners in this battle of control are empowerment shareholders who acquired their stake in Adcock less than 4 years ago at less than half the current share price.
Except for a few pockets of activity, the market is expected to remain subdued with more and more commentators forecasting lower returns due to lacklustre economic growth, interest rates that are bound to increase sometime and the effect of the weaker rand on domestic inflation.
- Fin24
*After chasing money on the JSE for 15 years, Adriaan Kruger is now living a relaxed lifestyle in Wilderness and lectures economics part-time at NMMU.
The week that was
Most shares ended the week at similar levels than a week ago after the JSE strengthened on Thursday and Friday to make up for losses at the beginning of the week.
Shares of international companies and exporters have, once again, advanced quite strong due to the decline in the rand which is at its lowest level in nearly 5 years.
The rand hit R10.58/$ mid-week, but recovered slightly to R10.32/$ on Friday as international investors continue to sell SA equities in favour of American and European markets.
The exodus of international funds led to a decline in the rand to such an extend that selling pressure were outweighed by the benefits of a weaker currency on asset prices and foreign income.
Commodity shares led the market higher with shares such as BHP Billiton [JSE:BIL], Anglo [JSE:AGL] and Sasol [JSE:SOL] showing quite large increases.
Naspers [JSE:NPN] increased to a new high of above R1000 per share due to the weaker rand and continued strength in the share price of its interest in the Tencent, which owns the largest internet portal in the lucrative Chinese market. The Tencent interest comprises some 90% of Naspers' market capitalisation.
The week ahead
Financial shares remained strong and amongst industrial companies the shares of Nampak [JSE:NPK], Bidvest [JSE:BVT] and Adcock-Ingram [JSE:AIP] continued to attract attention last week.
Bidvest and Adcock will continue to be in the news in coming weeks as the battle for control of Adcock between Bidvest and the Chilean CFR Pharmaceutical continues.
Adcock has started an advertising campaign to inform shareholders about the proposed transaction and remind them of their right to vote for or against the offer by CFR.
It will be interesting to see if Bidvest will up its cash offer of R70 per share to match CFR Pharmaceutical's offer of a mixture of cash and CFR shares valued at R75 per Adcock share.
The real winners in this battle of control are empowerment shareholders who acquired their stake in Adcock less than 4 years ago at less than half the current share price.
Except for a few pockets of activity, the market is expected to remain subdued with more and more commentators forecasting lower returns due to lacklustre economic growth, interest rates that are bound to increase sometime and the effect of the weaker rand on domestic inflation.
- Fin24
*After chasing money on the JSE for 15 years, Adriaan Kruger is now living a relaxed lifestyle in Wilderness and lectures economics part-time at NMMU.
