"For those of you who use Facebook exclusively, Instagram is more about photos, images, letting the picture tell 1000 words. If you want to know how it works, follow the link to the Instagram blog: Introducing Layout from Instagram. Again, there is a link to a help section on the Instagram blog which enables you to see how to use the new app, you can use up to 9 photos and then post them all together, via Instagram. Whilst there are many applications that allow you to do this, this is specifically for integration with Instagram, to allow you to do something different."
To market, to market to buy a fat pig. Resource stocks collectively had another stunning day again yesterday, again the market closed lower, the Rand continued to power ahead, once again though, it is all the Dollar. That made the commodity surge even stranger however, in the face of a weaker US Dollar it was to be expected. The relationship is a strange one, weak Dollar equals strong commodity prices, the opposite is true too, strong Dollar, weak commodities prices. The relationship is fleshed out a little via a blogpost that I found (via the BusinessInsider) by Jodie Gunzberg: A Strong U.S. Dollar Isn't Bad For All Commodities.
The thinking is pretty simple, all commodities are priced in Dollars right? The weaker the US Dollar, the greater the purchasing power of the rest of the world, including their insatiable demand for all commodities, therefore that translates to stronger prices. The stronger the US Dollar, the weaker most of the commodity prices, as a result of significantly reduced purchasing power of Brazilians all the way through to Vietnamese consumers.
It seems to work, from a demand point of view, the change here is that significant supply in some key commodities has come on stream, oil and gas, that we know, bulk commodities like iron ore specifically have certainly come on stream, gold, well that market is just different I guess. Platinum supply has been very tight, mostly as a result of huge pressures on the producers. Phew, the Chinese PMI numbers that came in now was another read below 50, expectations were for above 50.
The Greek drama continues to unfold, there was a meeting between Angela Merkel and her Greek counterpart yesterday, the FT reports: Merkel and Tsipras in bid to defuse tensions as cash fears rise. When it comes to the crunch of cash, the Greeks do not have a very strong hand. As we have thought all along, the Greek people (who have pulled significant amount of Euros from Greek banks) want to stay in the Eurozone. The Spanish economic minister has had some harsh words for them (the Greeks) suggesting that they cannot talk without the walk, i.e. going through with all of the painful changes. In other words, all the reforms that are needed. The story continues to evolve, the Germans have the upper hand and will negotiate hard.
Company corner snippets
Facebook announced a new Instagram app last evening: Introducing Layout from Instagram. For those of you who use Facebook exclusively, Instagram is more about photos, images, letting the picture tell 1000 words. If you want to know how it works, follow the link to the Instagram blog: Introducing Layout from Instagram. Again, there is a link to a help section on the Instagram blog which enables you to see how to use the new app, you can use up to 9 photos and then post them all together, via Instagram. Whilst there are many applications that allow you to do this, this is specifically for integration with Instagram, to allow you to do something different.
Why get excited about Instagram? Two reasons, one, it is one of the fastest growing social media platforms, check at December 2014 -> Instagram Hits 300 Million Monthly Users To Surpass Twitter, Keeps It Real With Verified Badges. From 200 to 300 million in just nine months. That user growth could slow, remember that Twitter struggles with this problem? This is for me a much bigger growth opportunity: RESEARCH: LESS THAN ONE-QUARTER OF BRANDS UTILIZE INSTAGRAM, DESPITE IT BEING THE FASTEST GROWING SOCIAL PLATFORM.
That is incredibly interesting, the fact that the most visual of all the platforms has the smallest corporate following. Many suggest that the ARPU's (average revenue per user) could be much higher on this platform. We continue to recommend Facebook as a conviction buy, they are of course the owners of the fastest growing platform, this is just another bolt on. What I learnt today is that Instagram is only for Android and iPhone, no other platform. If you thought that any other platform was important, this proves that there are only two. For me anyhow.
Apple got their first 1 trillion Dollar call last night. By that I mean that Cantor Fitzgerald stuck a target price of 180 Dollars on it, meaning with the current number of shares in issue, 5.82 billion, that equates to 1 trillion bucks. Got it? See the FT story associated with that 180 Dollar price target: Apple climbs after $1tn valuation call. There you go, someone called it.
Discovery rights issue. You might be wondering why you do not have the shares yet? The time frames are that the cash will flow against the shares coming in on Tuesday the 7th of April. The shares flow in and the cash flows out on that specific date. So why did we want the cash so early? The folks running the process need to know long before the time that the funds are available. So those are your time frames sports lovers.
Capitec Bank had their full year results come out this morning. The results are solid considering that the African Bank saga took place in the middle of the year.
EPS are up 26% and so is the dividend, making the full year dividend R8.36. Their client base grew 856 000 to 6.2 million people and they grew their retail deposits by R6.4 billion to R 30 billion. The strikes last year had some impact on their loans, gross loans impairments increased 5% but due to them issuing 8% more loans last year their impairment ratios decreased. All in all, a good set of results with EPS up, deposits up and clients up. The share is up 5% today.
We're reading this, you should too.
Based on these numbers, 5 years is still considered short term! The large amount of volatility in the market is the definition of risk when it comes to investing. The best way to get around the volatility would be to continually add to your portfolio. This takes out the need to ‘time the market' and allows you to average your entry price, with a bias to the lower prices because you buy more stock when prices are lower. - What Constitutes Long-Term in the Stock Market?
Something that could help slow the over use of antibiotics, I don't think that this will do much but research is heading in the right direction - Rapid blood test to 'cut antibiotic use'
Luxury goods is a big investment theme of ours here is a look at where the different brands feature - Here's the hierarchy of luxury brands around the world. Interesting line this, "Louis Vuitton, for instance, is considered a "brand for secretaries" by many wealthy Chinese."
Home again, home again, jiggety-jog. Stocks are up marginally again, the silence in the office is completely offensive. Ha ha, sorry chaps, we tried and failed to make the final of the World Cup cricket, that is the nature of sport. We have other winners in the form of our business giants, at least they get to show their talents and skills each and every day. You do not need to wait every four years for that to happen. Sigh, this is very familiar territory, at least we can say that a Joburg born and bred fellow (who is now a New Zealander) hit the winning runs. That feels even worse. Righto, the market is up around half a percent, the Dollar continues to lose steam, you are getting the sense that the one way trade on the Dollar is unwinding a little. The really good thing about that is it puts a lid on inflation.
Sasha Naryshkine, Byron Lotter and Michael Treherne
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