You're listening to Strictly Business Podcast with Lindsay Williams.
The JSC has closed its doors for another day, so it's time for the 5 o'clock
shadow.
And as always on a Wednesday, I speak to Skalk Lowe, Portfolio Manager at PSG
Wealth, Old Oak, Cape Town.
Quiet stuff, quiet time of the year in the Northern Hemisphere, Skalk.
I just want to ask you one question to kick off the podcast.
Four years ago, had you heard of NVIDIA?
Yes, I did.
But it's just because I'm a tech nerd.
So I did buy their products.
But I did not see them as a $3 trillion company.
$4 trillion company today.
$4 trillion today.
Correction.
$4 trillion company.
Man, oh, man.
Oh, man.
$4 trillion.
It wasn't that long ago where you were saying, was it Microsoft or Apple that hit
the $1 trillion mark?
And that was only a year ago or something.
Maybe a year and a half.
I don't know.
Now $4 trillion for another company.
It is crazy, crazy, crazy.
And yeah, I think last year, we celebrated that two companies went above $3 trillion,
which was
NVIDIA and Apple, if I'm not mistaken.
Or was it Microsoft?
But anyway, be that as it may, $4 trillion.
Crazy.
Incredible.
jsc could do with a four trillion rand company or you know a few more four
billion rand uh companies it's very very
quiet at the moment scale really is as i said the northern hemisphere uh affects
the southern hemisphere of course
yeah no it's a it's it's it's sort of the quiet before the storm i mean yeah we're
sitting
on the 9th of july and this is a significant date because we were sort of
dreading for the past let's call it uh
what was it 90 days yes 90 days we were
We're sort of dreading this day to come because are we going to see a second verse
same as the first,
very similar to the start of April?
And yet we're sitting, it's pretty much a non-event.
I was on another interview today and funny enough,
David Shapiro was with me.
Yeah, he actually started off and I don't want to quote David because that's just...
Well, you already are, so go for it.
He doesn't like it.
I'm very dangerous.
But he mentioned and he said, you know, maybe the world now got used to Trump.
I mean, maybe markets now got used to Trump.
And this is why we're seeing this.
And it's a very interesting comment to make because it's true.
Maybe markets are just…
sort of became blase to these and any any any follow it up by saying he went all
guns
blazing and and now we it most probably will settle around about the 10
percent terrorist mark in general now my
comment and i still i don't think that but anyway yes go on let's let's let's let's
let's let's play with that
let's let's just play with that scenario i agree with you i don't think we're we're
going to get Get to that 10% mark,
but let's play with the 10% mark.
If for whatever reason, let's go to the beginning of April, Trump came out and
said,
I'm going to bring out tariffs.
It's going to be beautiful tariffs.
It's going to be 10% and it's non-negotiable.
Boom, there we go.
And starting tomorrow, markets would have reacted extremely negative.
And it would have been now.
we're looking at this and saying 10% is a win.
And any country that get a 10% tariffs will sort of reply, where do I sign?
So it is.
We got used to it.
We were dreading this.
I mean, some of these tariffs were 200%.
And, you know, we know the fight between Trump and Xi or China.
I mean, bottom line is, it's just crazy, crazy how, you know, how
volatile, you know, things.
We haven't gone through one week since the 21st of January without some major event.
And all of those events usually had Trump involved.
Trump's art of the deal was based, I've never read it, and I will never read it,
but it's based on over-promising or under-promising.
So what he's done with the tariffs is very simple.
He's frightened everybody by saying it's going to be this level, it's going to be
that level,
and then that gives him the wiggle room to bring it down.
And as you quite rightly say, By bringing it down, people are relieved.
But if they had just started at that bottom and said, right, this is sworn into
law, you're going to be 10%, 15%,
20%, which people would be happy with now.
If you'd have done that at the end of March, early April, whenever it was, when
he did that Liberation Day rubbish,
markets would have reacted badly.
So in a way, he's quite clever by being such a simpleton.
If you see what I mean, he just says, oh, well, I'll start at 50 and I'll come down
to 10 and they'll be happy.
And that's that's where we're at.
He says now, well, we've extended 214 days from 90 days by going to August the 1st.
He has said now that that is the end of it.
No more extensions, which is a good sign for people in the market who rely on
imports and exports.
At least they know that August the 1st is the end of it, Skulk.
Correct.
That's.
That's it now.
I mean, there's no going back.
And I mean, if you listen to what he said, don't turn around,
don't come and retaliate with your own tariffs,
because then I will let you just go and double up your tariffs.
So that's it.
And everybody saw the playbook, you know, what happened after China retaliated.
And I think, yeah, I'm actually quite surprised.
We're sitting here, but...
As you rightfully said, this is the quiet season.
But we've still got three weeks till August the 1st.
Anything can happen.
I mean, who would have thought that yesterday, oh, well, 50% tariff on copper.
The copper price in New York, the futures, went up 18% yesterday.
It's unheard of.
Yeah, yeah, yeah, yeah.
No, it's, yeah, anyway.
Okay.
Anyway, it's that we, next week we'll, it's funny how we
every single week we've got something to say about um and like i said it hasn't
been six months it hasn't
been six months since he's sworn into to office so it's still three and a half
years to go what
fun i'm going to piggyback off you shamelessly and say what else did you and
david shapiro
discuss anything of any great uh meaning it was just i mean it was just that
the show was a market show and we pondered off and eventually ended up on the floor
back in the days and
the gold market.
But in short...
So you said nothing in other words.
We had nothing really to say.
But I think the bottom line was very similar to what you say.
I think this could go any direction.
We discussed a company which I would definitely like to touch on again and
that's Remgrove.
I mean, great.
great day for for for rim go in the market again you know up at two and a half
percent we we saw the the
announcement this morning that came through you know that the competition
commission now approved that
deal um of the merger of basically uh rim
grow selling their fiber business to to um vodacom yes and um yeah that was very very
good very good i mean vodacom initially was negative.
I think people were a bit worried there.
vodacom in it just just uh sort of positive and today but but rim grow up two
and a half percent um
and still trading 40 discount to its intrinsic value so it's so extraordinary
isn't it i mean when something
gets into the uh you know 30 to 35 area people say it's time to have a look at it
40 and it's been there for a
while it's been there for a while but but why i'm calling this one now and you know
you know this is it's like my
gold call i mean Remgrove has been one of my darlings for many years and it hasn't
done badly but
just stagnated.
It stayed like you just mentioned, this discounted NAV stayed at these 40% levels.
One stage actually got close to 50%.
But I mean the one thing that's been in the news since the beginning of the year
is the sort of unbundling,
the value unlocking of the Raynet, which we know is a Rupert company.
There's another Rupert company, and I just said, Remgrove,
that's also trading at these crazy discount levels.
I'm just asking myself the question, when will they turn around and say, well…
let's just do the same with rim grow i mean let's just just parcel it off and
then
there'd be some fun on on the jse because these are old school companies just miss
mentioned two of them
renette and rem grow you'll never see the likes of those again certainly
not the rem grow business model anyway no no the the rim grow business model i i
don't i don't
know it's not not the same business model and i think somewhere along the line very
similar to what
what Pete Matona has done with PSG Group.
It's just you decide, do you want to still go through this?
Let's just unlock the value and let's just do it quick.
It's like ripping off the band-aid.
Let's just rip it off and run AA.
But that's not currently talked about.
That's just my theory.
I like Remgrove because I like the companies inside Remgrove.
I like the fact that it's running at a very, very deep discount.
And I like the fact that it's still a very and the company's inside is a solid SA
Inc.
play.
So if you still like the SA Inc.
play, buy Rengross.
It's like that shampoo.
I mean, two in one.
You get so many more than just the one company.
There's so many more.
It's a great company to buy, and you're buying at a massive discount.
Very good.
You've sold it well.
Let's have a look at some prices here.
We've got the dollar round at 17.78.
The euro round is 20.83 British pound against the round
24.17. Euro dollar 117.15, which is barely changed.
Commodities now the gold price holding on to 3300.
It's 33.11 on my screen, down just over $40 an ounce.
Platinum is unchanged at 13.72.
And palladium is up 20, or one and two thirds percent.
to 11.33.
Now, the oil price is being a bit stubborn these days.
The oil price is, let's just get rid of these things that pop up and obliterate
it, 17.26 at the moment.
It's come off its highs, but nonetheless, 17.26 it is for Brent crude, up about a
third of a percent, and
West Texas crude, $68.54, which is up two-thirds of a percent, half a percent
now.
Natural gas price is down over 5%.
The copper price, which we mentioned earlier, has come off after an 18% move
yesterday,
down 3.5% today, as people say.
Really?
Is he going to go through with it?
Is this going to be a taco or not?
Trump always chickens out.
Yeah, I reckon.
It may be selectively applied.
but that he'll do it i can't think that he'll do it i mean i mean that's
the other side and go cut off your nose to spite your face i mean the u.s need copper
i mean they they
i mean the the usage from from from from uh the u.s side is is massive
yeah so yeah i don't know he woke up and had a dream about copper or something and
then
rushed into the white house and said tell him 50
and off went that blonde woman to the lectern and said this is happening it's
quite funny the way it works What else am I looking at?
Okay, S&P 500 futures barely changed, 62.80, that's the September futures.
The US 10-year Treasury yield was into the 4.40s and looking as though it was going
to go mid
4.40s and onwards with the oil price and everything else going on and the tariffs.
But no, it's behaving itself again, 4.38 and a bit.
And the South African 10-year, which has been such a good buy,
the yield falling and obviously the bond price itself going up 9.85% for that one.
Bitcoin stubbornly high,
just broken up through 109,000, 109,006,
up 0.7%.
And what else have we got here?
That's about it, Skulk.
So shall we have a look at some of the movers on the JSC?
You've mentioned your Remgrove, and you pointed out that you have got it, you do
like it, you do own it,
so that's good, a transparency there.
I've got on the upside, Italtile up 5.3%, Alphamin up 3.8%.
Remgro, yep, 2.5% higher, 173 in a bit.
And British American Tobacco has had a good day as well, 2.3% higher, just over.
Downside, Telcom, 3.6% weaker, Bytes, 3.2% down.
In the red by 3% is Glencore, Carew down 2.6%, and Anglo-American, PLC,
down 2.5%.
Sculpt.
Hmm.
Yeah, and you're not going to remind me again because for the past two weeks you
Remembered JC that you
we go.
There we go.
So I'm an interesting when you could see the volumes definitely picked up Lately,
we you know,
we've been we've been talking about this You can clearly see the daily daily value
traded on the J's been picking up But the ship
was not really reacting when you look at the J's II itself.
I see all shit
A year-to-date performance is currently literally trading at just shy of 18%
year-to-date.
When you look at the year-to-date performance of the JSE itself, JSE share
price,
not even 8.5%.
So, yeah, definitely not following suit.
So that can either mean there's an opportunity because we know that if your
volumes increase,
then the earnings could follow.
Okay, well, let's talk about those volumes in a moment.
Yeah, give us the closing indices and the volume to close the chat, if you would.
So the JSEG day, close the day, as I mentioned, literally just it's in the
positive.
Oh, no, actually, now with the most recent updates, it's three basis points down.
So flat.
Yeah, exactly.
So 97,230 points.
Resources were positive with a quarter of a percentage.
Industrials.
Down 11 basis points.
Financials were flat, just flat.
It was up one basis point while the SA property index were up 20 basis points.
And as you questioned, I mean, the turnover on the JSC today,
let me quickly just refresh my screen there because if that didn't refresh, then
let's just quickly have a look.
Okay.
Bitcoin has gone back down to 109,000 while you're talking.
S&P 500 up a quarter of a percent.
What else have we got here?
Nothing going on there.
Waiting.
People are waiting for things to happen, Scott.
What have you got there?
This is the case.
I mean, yesterday we had a 20 billion day, but the day before that, we had 14
billion.
The day before that, 13.4 billion.
That's setting the tone for the rest of the South African wind.
There we go.
Oh, gosh.
And today, literally just surpassed the 15 billion mark.
Quiet, Okay, Skalk, thanks very much for your time this evening on this quiet day.
Skalk Lowe is a portfolio manager at PSG Wealth, Old Oak in Cape Town,
and that was the
5
o'clock
shadow.
of the position of any other entity other than the speaker or the author.
And since we are critically thinking human beings, these views are always subject to
change,
revision and rethinking at any time.
Please do not hold us to them in perpetuity.