Google Cloud and Deutsche Bank Partner

09-JUL-20

I am very excited about the prospects for Google Cloud. We have seen how well it has done for Amazon and Microsoft. The cloud business is still in its early stages and I believe there is room for a third big player. That is why I was excited when I saw the following headline Google, Deutsche Bank Agree to 10-Year Cloud Partnership.


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Print More Money Honey

09-JUL-20

Market Scorecard Chinese stocks are on an eight-day green streak. That has meant a strong Tencent and by extension, a strong Naspers. Also helping the JSE has been the momentum from gold miners as the gold price crosses $1 800 for the first time since 2011. If you are a regular reader of this newsletter, you will know that we are not fans of gold. It costs money to take out of the ground, it then costs you money to store, and it doesn't even pay you a dividend! No thanks. Lets rather invest in growing companies that are changing the world.


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The Amazon in Full Flow

08-JUL-20

Market Scorecard Chinese shares have continued their weeklong surge higher. Of particular importance to us here in South Africa is that Tencent is up 5% this morning, pushing it further into record-high territory. A record-high Tencent means a record price for Naspers and Prosus. Most people are not aware of how much of their pension fund value is owed to Koos Bekker and Naspers' early investment into Tencent. For the last five years, the returns on the JSE have been very disappointing. Imagine how much worse things would have been without the biggest company tripling in value over the same period.


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Berkshire Adds to Natural Gas Portfolio

07-JUL-20

Warren Buffett has decided to spend some of his company's $137 billion cash pile in a $9.7 billion deal to acquire Dominion Energy's natural gas transmission and storage business. Berkshire Hathaway Energy is going to pay about $4 billion in cash and take on $5.7 billion of Dominion's existing debt.


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Uber Buys Postmates

07-JUL-20

A modest number of Vestact clients own Uber shares in New York portfolios. I have liked the prospects for the company for many years, and got very excited when they listed on the New York Stock Exchange in May 2019. I rounded up a few risk tolerant customers and we were ready with our money on listing day. The opening price on day one when we jumped in was $42 per share.


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Buffett Still Has Gas

07-JUL-20

Market Scorecard Yesterday the Chinese stock market had its best day since 2015, the Nasdaq closed at a record high, and Amazon topped $3 000 a share. It was a rather big day! During the panic in March, Amazon dropped to a low of $1 626 a share but even before the overall market bottomed out on the 23 March, it had already started to rebound. As countries started to lockdown, more consumer spending started to shift online, and Amazon started to hire a couple hundred thousand more people. Many consumers who were not customers last year have now seen how easy and efficient online shopping can be, and they have become customers for life. Technology companies are now significantly more relevant to society than they were a few months ago, and their share prices reflect this shift.


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A Bright New Podcast

06-JUL-20

Market Scorecard The focus for the market will start to shift towards Q2 earnings season which takes off next week. There is a trickle of companies coming out later this week, including Delta Air-lines, but things really get going on Tuesday next week when the big banks report. The stock market has penciled in a 44% drop in profits for this earnings season. To be clear, if on average profits are only down 40%, that is a beat on market expectations. The market already knows that this earnings season is going to be bad. It is the unexpected things that move market prices.


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Amgen Enbrel Patent Victory

03-JUL-20

If you own a bunch of high-quality stocks in a portfolio, good things are always happening to them, and you only find out later. Here's a case in point, Amgen just had a major patent protection victory. The stock popped up to a new all-time high of $260 per share yesterday.


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Musk Taunts Shorts

03-JUL-20

Market Scorecard


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Tesla Production Update

03-JUL-20

Yesterday Tesla reported delivery numbers which rocked the market (in a good way if you are long). The share price surged 8%, now trading at $1 208 a share. Over the last year the Tesla share price has gone from $234 to $901 then back down to $427 during the global shut down and then all the way back up to $1 000 and more.


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Apple and Lonely Planet Team Up

02-JUL-20

Although mobility, especially for travel, is not on top of everyone's agenda right now, this article caught my eye. Lonely Planet's expert recommendations are coming to Apple Maps.


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Tour de Home

02-JUL-20

Market Scorecard Now that the second quarter has come to an end, we are able to take stock. Looking at the US market, the tech-heavy Nasdaq was up 30%, and the S&P500 was up 20% - the best quarter since the late 90's. The strong quarter comes after the S&P 500 was down 20% for the first three months of the year, the worst Q1 on record. Note, there have been worse quarters, but not a worse Q1. For example, Q4 in 2008 the S&P 500 was down 22%.


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Google Buys North

02-JUL-20

Google announced on Tuesday that they are buying North, a Canadian company that makes smart glasses. Of course, Google has mountains of money and likes to buy talent and good ideas.


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Prosus FY Numbers - Strong Balance Sheet

01-JUL-20

On Friday evening, Naspers and Prosus released their full-year numbers. These companies are mostly interchangeable - Naspers owns 3/4 of Prosus and that stake in Prosus represents 99% of Naspers value. Generally, the market doesn't pay much attention to these results because the bulk of Prosus's value comes from its stake in Tencent, which trades on the Hong Kong stock exchange. Each day, the Tencent price changes in Hong Kong, and then the Prosus and Naspers share prices move in accordance when the European and South African markets open.


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Prosus Delivers

01-JUL-20

Market Scorecard So there we have it, the first half of 2020 is done. What an eventful six months! What does the second six months have in store for us? The JSE All-share is down 5% for the year, a significant improvement from the 33% loss we were facing in March. This is all in Rands of course. We started the year at $/R 14.01 and now we are at $/R 17.35, a weakening of 24%. Given that global assets are valued in USD, we probably need to measure the JSE performance in Dollars instead of Rands?


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