18
April 2024
Markets fell on interest rate outlook
Adriaan Pask, Chief Investment Officer
PSG Wealth
Market commentary
US stocks fell in volatile trading on Wednesday as investors evaluated the Federal Reserve's stance on interest rates and a series of disappointing earnings reports at the start of the financial reporting season. Amongst the biggest detractors was Travelers which fell significantly, exerting downward pressure on both the S&P 500 and the Dow. The insurance giant fell short of Wall Street expectations for first-quarter profits.
The rand saw minimal movement on Wednesday, while the FTSE/JSE All Share (ALSI) trimmed gains for the session as investors considered the likelihood of interest rates remaining elevated for an extended period. In local economic news, consumer inflation in March showed a slight moderation, marking the first decline in 2024. SA’s inflation rate eased to 5.30% in March, a slight decrease from 5.60% in February, which was slightly below the Bloomberg estimate of 5.40%. Core inflation, which excludes volatile food and oil prices, increased by 4.90% in March, down from February's eight-month high of 5%. The rand remained relatively stable at R19.04/$ at 17h30.
The FTSE 100 rebounded by 0.40% on Wednesday, recovering from a 1.90% decline the previous day, which marked its largest drop in nine months. The DAX 40 index in Frankfurt also saw a slight increase. However, earlier gains were reduced as markets assessed the latest corporate results and the implications of a more hawkish stance from the Fed.
The Shanghai Composite surged by 2.14%, reversing losses from the previous session as authorities clarified new delisting rules, alleviating market concerns. China's securities regulator stated on Tuesday that the tighter rules would not lead to a wave of delistings and would not impact small caps. In contrast, Japanese shares declined for the third consecutive session as US Federal Reserve Chair Jerome Powell remarked that the central bank needs to observe more progress on the inflation front before considering rate cuts.
WTI crude futures fell below $83 per barrel on Wednesday, extending a three-day decline. This drop followed the release of EIA data indicating a larger-than-expected increase in US crude inventories.
Navigation
Market indicators
select a tab to navigate
| Date | Index | Current Level | 1 Day Move | 1 Month Move | 6 Month Move | 1 Year Move |
|---|---|---|---|---|---|---|
| 2024-04-30 | ALSI | 76456.15 | 1.44 | 3.47 | 12.31 | 1.64 |
| 2024-04-30 | Basic minerals | 46504.98 | 2.64 | 10.84 | 15.73 | -3.06 |
| 2024-04-30 | Fin + Ind 30 | 9804.70 | 1.06 | 1.28 | 12.51 | 4.78 |
| 2024-04-30 | Financial | 40319.78 | 1.57 | 1.97 | 9.35 | 10.65 |
| 2024-04-30 | Industrial index | 111383.58 | 0.71 | 1.16 | 13.37 | 1.41 |
Some data may be delayed, the above table reflects the latest information available from Morningstar.
Please note performance reported during the first week of each month may be impacted by distributions. Distributions are fully accounted for by the second week of each month.
Collective investment schemes
Local funds
| ASISA category | Fund name | NAV (Rands) at 29 Apr 2024 | Performance –As at 2024/03/31 | |||
|---|---|---|---|---|---|---|
| 1 year % | 3 year % | 5 year % | Inception % | |||
| South Africa - Equity - General | PSG Equity Fund Class A | 16.46 | 5.43 | 15.72 | 9.73 | 12.71 |
| PSG Equity Fund Class A | 16.46 | 5.43 | 15.72 | 9.73 | 12.71 | |
| PSG Equity Fund Class E | 16.46 | 4.33 | 15.16 | 9.79 | 8.58 | |
| PSG Equity Fund Class F | 16.52 | 5.91 | 16.25 | 10.23 | 9.55 | |
| PSG SA Equity Class F | 1.53 | 2.14 | 15.97 | 8.69 | 6.79 | |
| PSG Wealth Creator Fund of Funds Class D | 51.63 | 6.61 | 9.40 | 10.37 | 11.86 | |
| South Africa - Multi Asset - Flexible | PSG Flexible Fund Class A | 7.90 | 5.12 | 14.65 | 9.77 | 11.16 |
| PSG Flexible Fund Class A | 7.90 | 5.12 | 14.65 | 9.77 | 11.16 | |
| PSG Flexible Fund Class E | 7.91 | 5.40 | 14.96 | 10.06 | 9.88 | |
| South Africa - Multi Asset - High Equity | PSG Balanced Fund Class A | 95.92 | 4.85 | 13.93 | 10.11 | 12.69 |
| PSG Balanced Fund Class A | 95.92 | 4.85 | 13.93 | 10.11 | 12.69 | |
| PSG Balanced Fund Class E | 96.01 | 5.45 | 14.59 | 10.74 | 9.56 | |
| PSG Wealth Moderate Fund of Funds Class D | 40.33 | 9.93 | 10.12 | 9.17 | 10.72 | |
| South Africa - Multi Asset - Low Equity | PSG Stable Fund Class A | 1.63 | 5.23 | 9.90 | 7.44 | 8.23 |
| PSG Stable Fund Class A | 1.63 | 5.23 | 9.90 | 7.44 | 8.23 | |
| PSG Stable Fund Class E | 1.63 | 5.83 | 10.54 | 8.05 | 7.95 | |
| PSG Wealth Preserver Fund of Funds Class D | 24.43 | 8.61 | 8.68 | 7.73 | 9.01 | |
| South Africa - Multi Asset - Income | PSG Diversified Income Fund Class A | 1.31 | 7.40 | 8.23 | 7.82 | 7.83 |
| PSG Diversified Income Fund Class A | 1.31 | 7.40 | 8.23 | 7.82 | 7.83 | |
| PSG Diversified Income Fund Class E | 1.31 | 8.07 | 8.84 | 8.39 | 8.26 | |
| PSG Wealth Income Fund of Funds Class D | 12.39 | 7.81 | 7.50 | 7.01 | 7.79 | |
| South Africa - Interest Bearing - Short Term | PSG Income Fund Class A | 1.08 | 7.76 | 6.73 | 7.28 | 7.10 |
| PSG Income Fund Class A | 1.08 | 7.76 | 6.73 | 7.28 | 7.10 | |
| PSG Income Fund Class E | 1.08 | 8.07 | 7.04 | 7.59 | 7.76 | |
| PSG Wealth Enhanced Interest Fund of Funds Class D | 1.02 | 8.96 | 6.59 | 6.49 | 6.71 | |
| South Africa - Interest Bearing - Money Market | PSG Money Market Fund Class A | 1.00 | 8.28 | 5.98 | 5.83 | 7.94 |
| PSG Money Market Fund Class A | 1.00 | 8.28 | 5.98 | 5.83 | 7.94 | |
| PSG Money Market Fund Class F | 1.00 | 8.59 | 6.26 | 6.10 | 5.28 | |
| South African - Multi Asset - Low Equity | PSG Investment Management Cautious Fund of Funds Class D | 1.29 | 5.22 | 9.01 | — | 9.62 |
| PSG Investment Management Cautious Fund of Funds Class D | 1.29 | 5.22 | 9.01 | — | 9.62 | |
| South African - Multi Asset - High Equity | PSG Investment Management Growth Fund of Funds Class D | 1.48 | 2.95 | 11.00 | — | 11.35 |
| PSG Investment Management Growth Fund of Funds Class D | 1.48 | 2.95 | 11.00 | — | 11.35 | |
| South African - Multi Asset - Income | PSG Investment Management Multi-Asset Income Fund of Funds Class D | 1.13 | 6.96 | 7.34 | — | 7.57 |
| PSG Investment Management Multi-Asset Income Fund of Funds Class D | 1.13 | 6.96 | 7.34 | — | 7.57 | |
Performance data on local funds is shown up to the last market close minus 1 day.
Some data may be delayed, the above table reflects the latest information available from Morningstar.
Please note performance reported during the first week of each month may be impacted by distributions. Distributions are fully accounted for by the second week of each month.
Global funds
Through our tried-and tested investment philosophy, we have built competitive global solutions to help clients achieve their investment goals.
The following funds are rand-denominated, but invest internationally:
| ASISA category | Fund name | NAV (Rands) at 29 Apr 2024 | Performance –As at 2024/03/31 | |||
|---|---|---|---|---|---|---|
| 1 year % | 3 year % | 5 year % | Inception % | |||
| Global - Equity - General | PSG Global Equity Feeder Fund Class A | 4.85 | 13.50 | 18.16 | 13.88 | 13.07 |
| PSG Global Equity Feeder Fund Class A | 4.85 | 13.50 | 18.16 | 13.88 | 13.07 | |
| PSG Global Equity Feeder Fund Class E | 5.02 | 14.16 | 18.84 | 14.44 | 12.79 | |
| PSG Wealth Global Creator Feeder Fund Class D | 4.59 | 31.95 | 14.40 | 16.71 | 15.72 | |
| Global - Multi Asset - Flexible | PSG Global Flexible Feeder Fund Class A | 3.75 | 11.50 | 15.71 | 13.27 | 12.83 |
| PSG Global Flexible Feeder Fund Class A | 3.75 | 11.50 | 15.71 | 13.27 | 12.83 | |
| PSG Global Flexible Feeder Fund Class B | 3.94 | 12.14 | 16.38 | 13.77 | 13.33 | |
| PSG Wealth Global Flexible Feeder Fund Class D | 4.75 | 16.82 | 8.82 | 11.36 | 11.51 | |
| PSG Wealth Global Moderate Feeder Fund Class D | 4.88 | 19.10 | 10.30 | 10.72 | 12.77 | |
| Global - Multi Asset - Low Equity | PSG Wealth Global Preserver Feeder Fund Class D | 1.53 | 15.10 | 9.24 | 8.30 | 7.48 |
| PSG Wealth Global Preserver Feeder Fund Class D | 1.53 | 15.10 | 9.24 | 8.30 | 7.48 | |
Performance data on offshore funds is shown up to the last market close minus 2 days.
Some data may be delayed, the above table reflects the latest information available from Morningstar.
Please note performance reported during the first week of each month may be impacted by distributions. Distributions are fully accounted for by the second week of each month.
Invest in other currencies
The following funds invest internationally using foreign currency
| ASISA category | Fund name | NAV (Rands) at 26 Apr 2024 | Performance –As at 2024/03/31 | |||
|---|---|---|---|---|---|---|
| 1 year % | 3 year % | 5 year % | Inception % | |||
| EAA Fund GBP Cautious Allocation | PSG Wealth Global Preserver FoF (GBP) Class D | 2.05 | 6.23 | 2.28 | 2.49 | 5.01 |
| PSG Wealth Global Preserver FoF (GBP) Class D | 2.05 | 6.23 | 2.28 | 2.49 | 5.01 | |
| EAA Fund GBP Flexible Allocation | PSG Wealth Global Flexible FoF (GBP) Class D | 3.70 | 7.61 | 3.14 | 6.39 | 9.38 |
| PSG Wealth Global Flexible FoF (GBP) Class D | 3.70 | 7.61 | 3.14 | 6.39 | 9.38 | |
| EAA Fund Global Flex-Cap Equity | PSG Global Equity Sub-Fund Class A | 2.20 | 6.31 | 8.80 | 8.10 | 5.87 |
| PSG Global Equity Sub-Fund Class A | 2.20 | 6.31 | 8.80 | 8.10 | 5.87 | |
| PSG Global Equity Sub-Fund Class B | 2.27 | 6.92 | 9.42 | 8.72 | 7.09 | |
| EAA Fund Global Large-Cap Blend Equity | PSG Wealth Global Creator Fund of Funds Class D | 2.83 | 23.38 | 5.16 | 10.46 | 9.82 |
| PSG Wealth Global Creator Fund of Funds Class D | 2.83 | 23.38 | 5.16 | 10.46 | 9.82 | |
| EAA Fund USD Cautious Allocation | PSG Wealth Global Preserver FoF (USD) Class D | 1.65 | 7.71 | 0.33 | 2.30 | 3.54 |
| PSG Wealth Global Preserver FoF (USD) Class D | 1.65 | 7.71 | 0.33 | 2.30 | 3.54 | |
| EAA Fund USD Flexible Allocation | PSG Global Flexible Sub-Fund Class A | 19.04 | 4.80 | 6.92 | 7.47 | 5.79 |
| PSG Global Flexible Sub-Fund Class A | 19.04 | 4.80 | 6.92 | 7.47 | 5.79 | |
| PSG Global Flexible Sub-Fund Class B | 20.17 | 5.29 | 7.42 | 8.05 | 6.41 | |
| PSG Investment Management Global Flexible Fund of Funds (Dollar) | 1.55 | 7.92 | -1.45 | 3.38 | 2.65 | |
| PSG Wealth Global Flexible FoF (USD) Class D | 2.99 | 9.46 | 0.13 | 5.54 | 7.87 | |
| EAA Fund USD Moderate Allocation | PSG Wealth Global Moderate Fund of Funds Class D | 1.98 | 11.27 | 1.35 | 4.74 | 5.25 |
| PSG Wealth Global Moderate Fund of Funds Class D | 1.98 | 11.27 | 1.35 | 4.74 | 5.25 | |
Performance data on offshore funds is shown up to the last market close minus 2 days.
Some data may be delayed, the above table reflects the latest information available from Morningstar.
Please note performance reported during the first week of each month may be impacted by distributions. Distributions are fully accounted for by the second week of each month.
Non-Collective investment schemes
House view equity portfolios
| Fund display name | Performance –As at 2024/04/30 | |||
|---|---|---|---|---|
| 1 year % | 3 year % | 5 year % | Inception % | |
| PSG Wealth Income Growth Equity Portfolio | 2.86 | 4.99 | -0.31 | 1.50 |
| PSG Wealth Offshore Equity Portfolio (USD) | 9.60 | 3.79 | 9.68 | 11.53 |
| PSG Wealth SA Equity Portfolio | -3.72 | 2.09 | 0.60 | 3.08 |
| PSG Wealth SA Property Equity Portfolio | 11.41 | 6.92 | -2.28 | -3.07 |
* PSG Wealth equity portfolio performance are shown gross of management fees, but net of brokerage and other trading costs.
The House view portfolios are bespoke solution portfolios and not part of the Collective Investment Schemes’ portfolios.
Recent investment ideas
Aspen
On 4 March 2024, Aspen released its half-year financial results for the six months ended 31 December 2023. · Total sales increased by 10.40% to R21.1bn, but up only 2% when adjusted for currency.
· EPS (cents) increased by 1.20% from 680 (cents in Dec 2022) to 688 (cents) in Dec 2023.
· EBITDA margins decreased from 26.50% to 24.60% as the company unwinds an inventory backlog of Heparin.
· The acquisition of a portfolio of drugs from Viatris, management of the Chinese volume-based procurement and filling of the vacant sterile contracts will lift growth going forward.
Our research supports a hold recommendation.
Please join us on Thursday at 11h30 for our Microsoft Teams Q&A sessions. Click here to join. <https://www.psg.co.za/wealthonline#investment-research>
Impala Platinum
n this report, we discuss the latest results released by Implala Platinum and provide our view on platinum group metals.
We include an updated valuation for Impala and stress test various assumptions to show valuation asymmetry that is skewed upwards. Impala Platinum released its interim results for the six months ended 31 December 2031 in early March 2024. The results, which contained the maiden interim inclusion of Impala Bafokeng, were characterised by the following:
- Refined production increased by 19% to 1.75moz.
- Revenue decreased by 25% driven by a materially lower PGM basket price.
- Earnings per share decreased by 89% to R1.80. o Rand weakened by 8% to R18.75 against the dollar.
- Implats has net cash of R5.2 billion (after the RBPlat acquisition).
- Implats had 16 fatalities during 1H24.
Our research supports a hold recommendation.
Please join us on Thursday at 11h30 for our Microsoft Teams Q&A sessions. Click here to join. <https://www.psg.co.za/wealthonline#investment-research>
FirstRand
On 29 February 2024, FirstRand released its half-year results for 2024. Highlights from the results were as follows:
1. Headline earnings were up by 6%, with revenue (+9%) rising in line with operating costs (+9%).
2. Net interest income increased by 13%.
a. Growth in core lending advances of 11% is the main driver of higher net interest income. Growth spread across segments with RMB corporate and investment banking being the largest contributor.
b. Net interest margin slightly increased from 4.38% to 4.47% benefitting less from higher interest rates due to FirstRand’s asset-liability management strategy which should also protect the margin when interest rates decrease.
Our research supports a buy recommendation.
Please join us on Thursday at 11h30 for our Microsoft Teams Q&A sessions. Click here to join. <https://www.psg.co.za/wealthonline#investment-research>
Economic Calendar
View the Economic Calendar
Corporate Actions
| Date | Company | Share code | Expectation |
|---|---|---|---|
| 17 April 2024 | ABSA Bank Limited Non-Cumulative Non-Redeemable Preference Shares | ABSP | Cash Dividend |
| 17 April 2024 | ADvTech Limited | ADH | Cash Dividend |
| 17 April 2024 | AVI Limited | AVI | Cash Dividend |
| 17 April 2024 | Ca sales Holdings Limited | CAA | Cash Dividend |
| 17 April 2024 | Coronation Fund Managers Limited | CML | Odd-Lot Offer |
| 17 April 2024 | Coronation Fund Managers Limited | CML | Repurchase Offer |
| 17 April 2024 | Coronation Fund Managers Limited | CML | Repurchase Offer |
| 17 April 2024 | Discovery Limited | DSY | Cash Dividend |
| 17 April 2024 | Heriot REIT Limited | HET | Cash Dividend |
| 17 April 2024 | MC Mining Limited | MCZ | Tender Offer |
| 17 April 2024 | Momentum Metropolitan Holdings Limited | MTM | Cash Dividend |
| 17 April 2024 | MTN Group Limited | MTN | Cash Dividend |
| 17 April 2024 | Old Mutual Limited | OMU | Cash Dividend |
| 17 April 2024 | Quilter Plc | QLT | Cash Dividend |
| 17 April 2024 | Remgro Limited | REM | Cash Dividend |
| 17 April 2024 | SA Corporate Real Estate Fund | SAC | Cash Dividend |
| 17 April 2024 | Sabvest Capital Limited | SBP | Cash Dividend |
| 17 April 2024 | Stadio Holdings Limited | SDO | Cash Dividend |
| 17 April 2024 | South Ocean Holdings Limited | SOH | Cash Dividend |
| 17 April 2024 | Thugela Resources Limited | TGA | Cash Dividend |
| 17 April 2024 | Telemasters Holdings Limited | TLM | Cash Dividend |
| 17 April 2024 | Anchor Group Pty Ltd | UAUG | Tender Offer |
| 19 April 2024 | Discovery Limited | DSY | Cash Dividend |
The information above is to the best of our knowledge correct.
The Corporate Actions are updated weekly.
Fund performance
Collective Investment Schemes in Securities (CIS) are generally medium-term to long-term investments. The value of participatory interests (units) may go down as well as up and past performance is not a guide to future performance. Collective Investment Schemes are traded at ruling prices and can engage in borrowing and scrip lending. A schedule of fees and charges and maximum commissions is available on request from PSG Collective Investments (RF) Limited. Commission and incentives may be paid, and if so, are included in the overall costs. Forward pricing is used. The Portfolios may be capped at any time in order for them to be managed in accordance with their mandate.
Performance is calculated for the portfolio and individual investor performance may differ as a result thereof. Different classes of participatory interest can apply to these portfolios and are subject to different fees, charges and possibly dividend withholding tax and will thus have differing performances. Annualised performances show longer term performance rescaled over a 12-month period. Individual performance may differ as a result of initial fees, the actual investment date, the date of reinvestment and dividend withholding tax. The portfolio is valued at 15h00 daily. Income distributions are net of any applicable taxes. Investment performance data is for illustrative purposes only. Actual performance figures are available on request. Always refer to the fund fact sheet (Minimum Disclosure Document) for full details, fees and risks of the fund.
Stay Informed
Sign up for our newsletters and receive information on finance.