Commodities take a step lower - Three to buy and one to sell
Commodities take a step lower
Brent oil led the commodity basket lower last week, losing 8,1%; Platinum and Gold were down 5,7% and 2,4% respectively.
Although the Rand softened, the pressure was too much for the JSE All Share Index which fell 0,8%. Resources fell 5,5%, but the rest of the sectors held up well.
International indices were slightly softer across most time zones. The markets will be watching US rates this Wednesday, which the Federal Reserve is expected to increase rates by 0,25%.
Alsi 40 Future (March 2017):
We had a lot of interest in our ALSI trading idea last week, so here is an update:
Entry level of 44,150 was achieved and the Index is now 500 points higher. We are still looking for another 500 point move by Thursday. If you are in the trade, you can just let the contract expire and the profit will settle in cash on Thursday night. We are looking for a total profit of 1,000 points in 7 days or 33% return on margin.
If you have not bought yet, place a bid at 44,450, we could see some weakness to that level.
3 Stocks to Buy
Anglo American has reach our target for entry
The softer commodity prices have pushed Anglos below our R190 target. The Rand is showing some weakness and Anglos is trading near support, Buy here as we expect a rally back toward R240.
Buy Remgro - Balanced portfolio trading at an attractive discount
After a hefty sell-off during the second half of 2016, Remgro shares have been consolidating in a trading band for the past six months. This Company holds a diversified portfolio of good quality shares with exposure to Financials, Healthcare and Food. It provides consistent growth and is relatively defensive. The discount is currently at about 15% of net asset value. It is the kind of share that will rally on a slight improvement in sentiment. Buy
Buy Steinhoff - Steinhoff shares ready to rally
The support level at R63 continues to provide a strong base and the share looks ready to build from these levels. There have been a few distractions lately and the market questioned its bid for Shoprite. With those behind it now, add this share to your portfolio. It is reasonably priced and has significant upside. If you buy today you will be eligible to receive a small dividend. Buy
1 Stock to Sell
PSG Group - Nice rally – Take profit…
PSG has run nicely and is within reach of its previous high. This follows solid financial results from several of the listed subsidiaries, namely Capitec and Curro. The flurry of updated information at this time of year tends to create its own hype in the PSG share price. That is likely to subside in the next few weeks and a 10% retracement in the share price would be quite normal. Take profit, sell above R260,00.
All too often we see clients neglect their offshore investment decisions until there is panic in the currency. The Rand has strengthened to levels last seen in 2015 (before NeneGate).
We recently rebalanced our Global Portfolio. Contact us if you would like to discuss Offshore Investment options.
Director of Prodigy Asset Management