Date published - 2024-05-14

(This is a very shortened version highlighting excerpts of our full report which is available for our paid subscribers). 

US markets rallied again last week, a third consecutive week of gains, approaching levels close to record highs posted in March. The S&P 500 gained 1.6%, the Dow Jones rallied 1.9%, and the tech heavy NASDAQ trailed, rising by a more muted 1.1%. In the US, Disney (-7.9%) ,Tesla(-8%), Shopify (-21%) and Airbnb (-8%) all caught our focus.

Yields on the US 10-year were mostly unchanged. Brent crude fell below $83 per barrel on concerns that slowing economic growth and rates remaining on hold could dampen oil demand coupled with concerning US inventory data. Gold surged to over $2,350 per ounce as ongoing geopolitical tensions and strong global demand for gold, especially from central banks and Asian markets supported prices.

This week we consider an SA investment vehicle and a global megacap.

Some SA company highlights last week:

Pan African Resources (+5.2%), Sappi (+2.9%), AB InBev (+5.4%), Attacq (+1.1%) and Gold Fields (+2.4%) were in focus with news.

More detail in the full report.

Feature Slide - Understanding "2nd" Movement in Price Action

Understanding the Importance of the Second Movement in Price Action Trading In the world of trading, understanding the dynamics of price movements is crucial for making informed decisions. One effective strategy often utilised by traders is to respond to the second movement in a price action sequence. This approach is based on the premise that the second movement provides a clearer signal of the market's direction, thereby offering a more reliable basis for predicting future price movements. Let’s break down why this is significant and how it can be used effectively.


S&P’s PMI for South Africa moved back into expansion territory in April. In a contrasting data print, manufacturing production fell 6.4% year-on-year in March. We also saw SA’s foreign exchange reserves decrease to $61.795 billion in April.

Globally, Chinese data was generally positive. Trade data was stronger than expected and CPI ticked higher. The UK saw GDP bounce and end the recession. Unsurprisingly, the BOE also kept rates on hold at 5.25% in line with expectations, but 2 dissenting votes favoured a cut in the policy rate.

Lastly, in the US, inflation expectations rose both in the near term as well as over the longer term.

For the week ahead:

SA: SARB Quarterly Bulletin, SA Unemployment, Mining production and retail sales.

UK/Europe: GDP, inflation, jobs data.

US: Inflation, retail sales

China: House prices, rates, industrial production, retail sales.

Our Market's and Risk view:

The short term counter rally has extended and remarkably, our risk indicators have moved into "NEUTRAL" territory. The volatility index has retreated and is subdued again. Safe haven demand is also having a large bearing on the risk matrix in the short term. In contrast to the overall matrix, the put/call ratio and overall momentum have moved back into 'GREED'. This dichotomy suggests a high level of uncertainty and contributes to our cautious outlook.

(Corporate clients can contact us for more detail on our overall risk matrix).

Our full report unpacks all of this in more detail as well as their implications for the markets.

This note is just a 'menu'. There's alot of detail underlying the comments above. Our paying subscribers can get under the hood to see what's driving the economy and the markets. Join us.

If you are not a subscriber, you are missing out on the key details, an overview of the week ahead and quality insights with actionable trade ideas weekly. Click below to sign up!


The full report is available to our Monthly and Annual Members.  To read the full report, please login or join us.