Our Investor Community enables you to discuss, analyse, blog, live chat and engage with likeminded people on JSE and USA-listed companies and more. FREE to join!
The Week Ahead of 24 June 2019
The Week Ahead of 24 June 2019
Published Date: 2019-06-25 | Source: INCE|Community | Author: Roxanne Segers
Geopolitical tensions in the middle east escalated significantly last week with the shooting down of an unmanned US drone by Iran. US President Donald Trump's initial response was to consider bombing Iran in retaliation but he backed off and subsequently decided to apply more sanctions against the Islamic republic. The oil price spiked higher briefly but has settled down again. OPEC meets in Vienna the week after next and oil analyst opinions on the likely oil price trajectory are divided, depending on whether or not the cartel can agree on production cuts.
The S&P 500 reached a new high of 2 954 18 on Thu Jun 20 and closed 2.2% up for the week at 2 950.18. This positive sentiment was largely driven by US Federal Reserve Chairman Jerome Powell's dovish remarks at the FOMC meeting earlier in the week. But as stated in a number of previous notes, the S&P 500 is now in very uncertain territory. It is subject to many and various factors and is no place for the casual investor. More and more it is the preserve of the professional investor and speculator. US President Donald Trump is planning to meet with his Chinese counterpart Xi Ji Ping at the G20 meeting in Osaka, Japan, next week and trade talks are likely to be at the top of the dialogue agenda. If a favourable result eventuates, expect the index to climb even higher. The stakes are high for both participants, with Trump having kicked off his 2020 presidential campaign and Xi having to contend with unrest in the semi-autonomous region of Hong Kong and the slowing in the Chinese economy caused by continuing trade wars.
The Conservative Party MPs managed to whittle down the number of contenders for the leadership and the post of prime minister to two last week. Boris Johnson and Jeremy Hunt will be slugging it out in hustings over the next month, while the membership of the Conservative Party makes its mind up as to which of the contenders it wants to install in Number 10 Downing Street. Boris Johnson's chances of becoming prime minister took a blow after the hustings debate on Sky News, where Johnson handled a question relating to why the police were called to his girlfriend's house in the early hours of Fri morning, Jun 21, very badly. Hunt's popularity, conversely, appears to have risen in the past few days, even though Johnson remains the clear front-runner.
The JSE All Share Index closed 1.3% up on the week and is now only 4% below its all-time high recorded on Jan 25, 2018. Naspers released its results to 31 Mar, with HEPS up 122% at 860c. Naspers will also be listing its technology interests in Amsterdam next month; "We intend to complete the listing of our international ecommerce assets on Euronext Amsterdam in July 2019, creating a new opportunity for international technology investors to access our unique portfolio and reducing our weighting on the JSE - a step we believe will help us maximise shareholder value over time." The new entity will be called Prosus. Old Mutual CEO Peter Moyo, who was suspended earlier this month, had his employment terminated last week due to a conflict of interest issue. Moyo has indicated that he will challenge his dismissal in court.
JSE listed company results out this week;
- 25 June 2019