Rates coming down next month, which sectors benefit most?

Simon BrownJSE Direct, Latest



Episode Summary:

In this episode of JSE Direct, Simon Brown delves into the impact of anticipated interest rate cuts and how they may affect various sectors and stocks. He shares his thoughts on potential beneficiaries like consumer stocks, REITs, and companies with high levels of debt. The episode also covers key updates on Nvidia’s earnings, Nike’s stock valuation, and a new ETF listing by ETFSA.

Interest Rate Cuts and Market Impact:
  • Jerome Powell’s Jackson Hole Speech: The anticipation of rate cuts as early as September, with an expected reduction of around 75 basis points by the end of the year.
  • Benefiting Sectors: Companies with significant debt, consumer stocks (Mr Price*, Foschini*, Shoprite*), and REITs are likely to benefit from lower interest rates.
  • Sector-Specific Insights:
    • REITs: Discusses the potential for real estate investment trusts like Stor-Age*, Spear, and the concerns around office spaces with high vacancy rates.
    • Consumer Stocks: Simon reiterates his positive outlook on consumer-focused companies and the strong performance of used and new car sales, highlighting stocks like CMH* and Motus.
Stock Analysis:
  • Nvidia: With results due, Simon highlights the market’s expectations and the potential for significant movement based on the earnings report.
  • Nvidia | Close 27 aug 24 | Weekly chart

    Nvidia | Close 27 aug 24 | Weekly chart

    Nike: Simon discusses Nike’s current valuation, seeing it as a strong buy at its multi-decade support levels, despite its challenges.

Nike | Close 27 aug 24 | Weekly chart

Nike | Close 27 aug 24 | Weekly chart

ETF Updates:
Housekeeping:
  • No Show Next Week: Simon will be on vacation and the podcast will resume on 12 September.
  • Money Summit: Scheduled for 10 September in Johannesburg with free tickets available using the code “MONEYWEBGEST” at MoneySummit.co.za.


Simon Brown

* I hold ungeared positions.

All charts by KoyFin | Get 10% off your order

  • Subscribe to our feed here
  • Subscribe or review us in iTunes

JSE – The JSE is a registered trademark of the JSE Limited.

JSE Direct is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.


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.

Contact Simon
More about Simon

 

JSE – The JSE is a registered trademark of the JSE Limited.

JSE Direct is an independent broadcast and is not endorsed or affiliated with, nor has it been authorised, or otherwise approved by JSE Limited. The views expressed in this programme are solely those of the presenter, and do not necessarily reflect the views of JSE Limited.



Tax on retirement savings
RSA Retail Savings Bonds rates (updated October 2024)
Just One Lap user survey highlights
China to the Rescue and ZAR Powers Stronger. What’s the Target?