Viewing posts categorised under: Market Commentary

South Africa – What Is Fair Value For The Rand In A World Of Normalized Interest Rates?

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Market Commentary, Market Insights

In this article, we will review the latest economic data for South Africa and discuss some of its implications as it relates to the outlook for the country's financial assets, including the MSCI iShares South Africa exchange-traded fund (NYSEARCA:EZA). More importantly in the final part of this article, we will detail what we consider a reasonable downside target for the currency, based on the assumption that the global liquidity backdrop (specifically $ liquidity) will continue to tighten further over the next 12 to 18 months. https://seekingalpha.com/article/4208663-south-africa-fair-value-rand-world-normalized-interest-rates?source=all_articles_title

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South Africa And The Impossible Trinity

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Market Commentary, Market Insights

In this article we will provide an update on the economic outlook for South Africa based on the most recent economic data releases. The article should help refine readers views as it pertains to the short and longer-term outlook for South African financial assets and specifically as it pertains to the MSCI South Africa exchange traded fund (NYSEARCA:EZA). We will also provide some additional insights as it pertains to the longer-term outlook and importantly in the context of the recent Mid-Term Budget (MTB) presentation. The MTB will garner more attention this year given the recent appointment of former central bank governor Tito Mboweni, who replaced the incumbent Nhlanhla Nene, after the latter resigned following revelations related to the country's ongoing corruption hearings. https://seekingalpha.com/article/4213815-south-africa-impossible-trinity?source=all_articles_title

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Oil Price Outlook – Beyond The OPEC Cut

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Market Commentary, Market Insights

In this article, we are going to discuss at a high level the medium-term outlook for oil prices (USO) and whether or not oil could trade even higher from present levels. This is despite the recent rally which has seen oil trade above $70 per barrel recently and for the first time since 2014.
https://seekingalpha.com/article/4175209-oil-price-outlook-beyond-opec-cut

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Recent Data Highlights Ongoing Slump In South African Industry Activity

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Market Commentary, Market Insights

In this article, we will take a look at the most recent economic data covering the South African (EZA) economy, specifically referencing the supply-side or production side of the economy. As we have detailed in prior articles, a mix of structural constraints (most notably as it pertains to the country's state-owned electricity company), as well as an ongoing and worsening policy disconnect, are severely damaging the country's supply-side and key export sectors.
https://seekingalpha.com/article/4172867-recent-data-highlights-ongoing-slump-south-african-industry-activity

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South Africa’s Unsecured Lending Industry – Separating Fact From Fiction

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Market Commentary, Market Insights

The unsecured lending industry (sub-prime) in South Africa (EZA) has once again come under the spotlight after the publication of a recent report by short sellers, Viceroy Research, which focused on the country’s largest unsecured lender, Capitec (OTCPK:CKHGY).
https://seekingalpha.com/article/4162849-south-africas-unsecured-lending-industry-separating-fact-fiction

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Is The Global Oil Market Too Dependent On Prospective Growth In The Permian?

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Market Commentary, Market Insights

In this article, we will review the latest Drilling Productivity Report (DPR) from the U.S. Energy Information Administration (EIA) for the period covering March 2018. In particular, we will focus on the metrics and trends for the premier shale basin in the U.S., the Permian located in West Texas and Eastern New Mexico, and what this may mean for the US Exploration and Production sector (XOP).
https://seekingalpha.com/article/4161289-global-oil-market-dependent-prospective-growth-permian

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South Africa’s Current Account Balance To Deteriorate In 2018

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Market Commentary, Market Insights

South Africa’s (EZA) current account balance narrowed modestly in 2017 from 2.8% of GDP in 2016 (calendar) to 2.5%. The narrowing in the country’s current account deficit was due to the widening in the country’s trade surplus from ZAR 35bn in 2016 to ZAR 69bn in 2017 or roughly 1.5% of GDP. https://seekingalpha.com/article/4157800-south-africas-current-account-balance-deteriorate-2018

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Global Trade Wars And Western Populism And The Case For Gold

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Market Commentary, Market Insights

Two key events that have taken place over the past week could fundamentally reshape the appetite for global risk going forward, the first being the renewed risk of a global trade war, and the second, the outcome of the recently held Italian elections.
https://seekingalpha.com/article/4153686-global-trade-wars-western-populism-case-gold

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The Outlook For The U.S. Dollar In 2018

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Market Commentary, Market Insights

In this article, we assess the outlook for the US dollar (NYSEARCA:UUP) over the medium term, particularly in light of the currency's relative under performance in 2017. Despite a further 75 basis point (bps) increase in the Federal Reserve's targeted rate band, the US dollar (USD) lost ground against most major currencies, as well as a handful of emerging market currencies.
https://seekingalpha.com/article/4136657-outlook-u-s-dollar-2018

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The South African Policy Disconnect – Is It Accelerating The Country’s Drift To Populism?

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Market Commentary, Market Insights

South African financial assets have recently enjoyed strong gains on the back of the election of the perceived market reformist Cyril Ramaphosa as the new president of the country’s ruling political party, the African National Congress (ANC), in December. The country’s currency, the rand, in particular appreciated strongly in December, gaining more than 10% against the US dollar for calendar 2017. Since making a cyclical bottom in January 2016, the iShares MSCI South Africa ETF (NYSEARCA:EZA) has nearly doubled.
https://seekingalpha.com/article/4134348-south-african-policy-disconnect-accelerating-countrys-drift-populism

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