Diamonds and rubies

Good Morning Voornaam,

Last chance saloon: if you want to attend Unlock the Stock at 12pm today with Attacq and Tharisa, you need to register at this link. This wonderful opportunity to be an equity analyst for an hour is brought to you by A2X.

As you'll discover in the upcoming episode of Magic Markets, we are going back to basics with some shorter shows aimed at teaching concepts. In the meantime, don't fall behind on episodes! Make sure you catch Episode 129 with a discussion on the recent "relief rally" on the JSE and US vs. local consumers.

For a short-form podcast that delivers you several company updates in around 8 minutes, Ghost Wrap is the perfect choice. Brought to you by Mazars, the latest episode features my views on PPC, Sephaku Holdings, Naspers, Prosus, Spar, Alexander Forbes, Glencore, MultiChoice and Telkom.

Today's final podcast is for company owners who want to understand more about the process (and risks) of selling their businesses, particularly to corporate acquirers. I spoke with UK-based professional Mark Davidson on the bizval podcast. There's much to learn in this show.

Of diamonds, rubies and banks

There were several interesting updates on the local market yesterday. We saw both De Beers (part of Anglo American) and Gemfields updating the market on sales of diamonds and rubies respectively. Of much broader relevance was an earnings update from FirstRand, showing a stark difference in strategy to some of the other banks.

You see, credit loss ratios at other banks have largely blown out of target ranges. Earnings are still growing strongly, but provisions are really biting now. At FirstRand, a del iberate decision to focus on higher quality lending opportunities is paying off in this environment. But it's not all roses for investors, as FirstRand's expenses have grown at a similar rate to income, whereas Standard Bank showed us some positive JAWS (i.e. growth in operating margin) in the latest update.

It really is important to improve your understanding of banking, as the sector touches literally everything. For the latest from FirstRand along with De Beers, Gemfields, Growthpoint, Marshall Monteagle, Spear REIT and Steinhoff (sigh), read Ghost Bites here>>>

Testimony by Powell

TreasuryONE notes that Jerome Powell's testimony has echoed the message we've consistently heard from the Fed in prior meetings. They anticipate higher inflation to persist in the second half of the year and they are still talking to the possibility of further hikes.

In the UK, inflation came in at 8.7% year-on-year, ahead of forecasts of 8.4% and all but confirming the expected hike of 25 basis points today.

Locally, inflation eased to 6.3% year-on-year, slightly below expectations and attributable to a slower increase in food and non-alcoholic beverage prices. Still, most indications point to sustained inflation for the remainder of the year, which supports the market's expectation of further tightening by the SARB.

The rand remains range-bound between R18.15 and R18.50.

Those who attended the emigration webinar that I hosted a few weeks back with Dylan Griffiths of TreasuryONE will have taken note of a follow-up webinar that TreasuryONE will be running that puts more focus on the tax nuts and bolts. I'm not involved in the webinar but I highly recommend that you register if the SARS tax clearance process is of relevance to you. The webinar takes place on Tuesday 27th June at 10am. Register here>>>

By the time you read this, I'll be on a plane to Joburg for an event. Have a terrific day!

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