MyWealth Investments Weekly Report Back for the Week Ending October 22

During the past week the markets were very volatile in both an upwards and downwards trajectory, but these were our take-aways and highlights of the movements. We also note trends in the global and local economies to give you a snapshot of the current circumstances in these areas.

SA Company News

• Mediclinic was up more than 11% on the back of stellar results.
• Coca-Cola reportedly seeks R120bn value in a JSE listing in 2022.
• Sasol had its credit rating reaffirmed by the ratings agency S&P Global to BB on strong cash flows and debt reduction. Sasol Ltd posted a 44% rise in first-quarter revenue in its main chemicals business on higher chemical and crude oil prices.
• Cashbuild reported a fall of 13% in revenue as 36 of its stores were looted in July, with 32 of the outlets remaining closed.
• Clicks headline earnings rose 1.3% to R1.9 billion and declared a final dividend of R3.47/share which means the total dividend for the year is R4.90/share.
• The JSE All Share index ended at 67051 on Friday, 22 October 2021.

SA Economy

• Consumer price inflation index rose to 5% in September 2021 due to sharp increases in the cost of transport, food, and housing, slightly up from 4.9% in August 2021, setting up for an interest-rate increase in the coming months.
• Motorists need to brace themselves for a massive fuel price hike in November. The increases would push the inland price of 95 ULP above R19 a litre and R17 a litre for diesel.
• South African Property Owners Association (SAPOA) reported the office vacancy rate has reached a new all-time high of 15.4%.
• Revenue in the tourism sector is still 60% lower than normal even though tourism and business travel continue to recover.

Global Economy

• Mounting inflation, supply-chain problems and the energy crunch still pose a risk for global growth.
• In China, the world’s largest economy, the housing market slowed substantially last month as demand from home buyers declined and the country’s debt-saddled developers cut spending.
• UK: British inflation slowed unexpectedly last month. The consumer price inflation rate in the UK slowed to 3.1% in September and retail sales dropped by 0.2% September adding to signs of weakness in the recovery from COVID-19.
• Europe: The Eurozone annual inflation rate came in at 3.4%, well above the European Central Bank’s target of 2.0%.
• Investors continue to worry over whether the recent spike in inflation is more long-lasting and what it means for monetary policy both in the UK and US.

Cryptocurrencies

• Bitcoin this week briefly rallied to $64 475, less than $400 off its all-time high as the Bitcoin Strategy ETF started trading on the New York Stock Exchange.

Commodities

• The price of Brent crude ended the week 0.8 % higher at $85.53.
• Gold futures were higher at $1791, helped by a slightly softer dollar.
• Nickel, which is used mainly to make stainless steel, surged past $21,000 a ton due to a global shortage.

Currencies

• The rand had firmed 1.5 % to R 14.82/$ for the week ended 22 October 2021.
• The U.S. dollar weakened 0.3% against the Euro at EUR/USD 1.164.

Read also:

• The Cost of Investing in Shares
• MYWEALTH INVESTMENTS: Summary of the Investment Club Meeting on 16 September 2021 – Part Two