Daily Market Blog: Frothy fistycuffs

16-SEP-14


"Why would SABMiller's share price have been up as much as 12 percent during the day here in South Africa? Well, if AB Inbev are supposedly looking for a 122 billion Dollar takeout of SABMiller, and SABMiller were no longer the hunter, rather the prey, you can see why the share price would be more elevated."






To market, to market to buy a fat pig. We were closed, and by we, I mean the royal we, the JSE systems were under pressure and as such trade only started around 11:30 local time, SENS messages started flowing around an hour earlier than that. When we eventually opened, it was weak across the board, financials and in particular the resource companies continue to bear the brunt of sloppy Chinese data, pointing to weakening demand and an average looking economy. I am pretty sure that everyone would love to have an average economy that grew by 7.5 percent off an ever increasing base, locally we are confined to just missing a recession. Yowsers.

It certainly is tough out there, the impact of the various stoppages in the economy continue to flow through the numbers of the ZA inc. businesses. In fact, I was on the box with a fellow from BAML who said that South African companies that have a larger portion of their earnings offshore, those companies attracted a serious premium to those that were just purely South African. Makes sense I guess, most of that premium was as a result of a weaker currency through the year.

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Stocks which we currently recommend

Amazon.com is the world's leading online retailer.

Apple is global leader in tablet and smartphone technology.

Aspen is a rising global star in generic pharmaceuticals.

BHP Billiton is the world's largest industrial commodity mining company.

Bidvest is a diversified services company, which may re-organise its portfolio.

Cerner provides IT solutions in the healthcare industry.

City Lodge is a growing mid-priced hotel group in urban areas of SA.

Discovery is a healthcare services administrator and life insurer.

Famous Brands is SA's largest quick-service restaurant group.

General Electric is a diversified investment holding company.

Google is the world's biggest search engine and online advertising platform.

Johnson & Johnson is the largest consumer healthcare and pharma company.

L'Oreal is a world leader in the manufacturing and sale of beauty products.

Luxottica is the world's largest branded sunglass maker and retailer.

MTN Group is an emerging markets mobile telecoms giant.

Massmart is a big-box discount retailer in Africa, now 51% owned by Wal-Mart.

Mediclinic owns hospitals in SA, the UAE and Switzerland.

Naspers is an in emerging markets company focussed on digital TV & Internet.

Nike is a global designer and retailer of sporting equipment.

Omnia is a fertiliser and explosives producer.

Richemont is a luxury brands company expanding in Asia.

Sasol is a global player in chemicals and fuels technology.

Starbucks is a roaster, marketer and retailer of coffee.

Stryker makes hip and knee joint replacements and hospital beds.

Tiger Brands is a basic and branded food producer, expanding through Africa.

Visa is a global payments technology company.

Woolworths is SA's leading organic food retailer & clothing business.

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