Inflation, it ain’t over. So what about rates?

Simon BrownJSE Direct, Latest

Pick n Pay* Chart Analysis
  • Resistance zone around 26, potential to touch 26.70
  • Higher highs, higher lows, horizontal resistance
  • Target: 30 bucks to fill the gap
  • Comments on Pick n Pay’s potential under Sean Summers
  • No need for a rights issue, potential market spook if it happens
  • Simon’s position: Started building, considering more
  • Current status: Down 1.7%, trading at 25.30
Pick n Pay close 13Feb24 (daily)

Pick n Pay close 13Feb24 (daily)

Transaction Capital and WeBuyCars
  • Transaction Capital planning to list WeBuyCars
  • Unbundling process expected in March
  • Valuation: 7.5 billion rand
  • Key information: Founders’ put option on Transaction Capital is off the table
  • WeBuyCar’s strong performance in January with a record 14,000 cars sold
  • Market Cap of Transaction Capital: R6.5 billion
  • Opportunities and challenges in SA Taxi business
  • Overall assessment: Looking not too bad
  • Current stock level: 850c
  • Expectation of pro rata shares for Transaction Capital holders
  • Timing details expected in the circular
Gold Price Movement
  • Gold weaker despite US and UK inflation data
  • Current gold price and chart analysis
  • Simon’s position in Anglogold Ashanti*
  • Observations on unexpected weakness in gold price after inflation data
Gold daily chart 14Feb24

Gold daily chart 14Feb24

Canal+ Offer for MultiChoice
  • MultiChoice facing a 105 rand Canal+ offer
  • Market sentiment: Canal+ likely to come back with a better offer
  • Current stock price: 104.63
  • Speculation on possible offer prices: 120, 135, or even 160
  • Market confidence in Canal+ making a mandatory offer
Global Market Trends and Dollar Strength
  • Dollar strength in global markets
  • DXY trading at 104.87
  • Money flowing into the US due to fear and concerns
  • Impact on Rand: Trading at 19.07
  • Market skepticism about inflation concerns
DXY (US$ index) 14Feb24 (daily chart)

DXY (US$ index) 14Feb24 (daily chart)

Inflation Analysis
  • Recent US and UK inflation data
  • Market reaction to inflation numbers
  • Central bank concerns about reaching inflation targets
  • Jerome Powell’s cautious approach and potential rate cuts
  • Local inflation expectations and potential rate cuts in South Africa
  • The challenge of getting back to the inflation target

* I hold ungeared positions.

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JSE Direct Podcast

Simon Brown - Just One Lap founder

Thursdays are all about hard-core investing and trading with Simon Brown’s famous JSE Direct podcast. JSE Direct started life on ClassicFM in July 2008 and became a podcast in 2011. Every week Simon shares his views on the state of global economies, individual shares and events moving markets.

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