Global markets remain robust with no clear signs of a downturn as volatility slowly declines. Investors are buying even the smallest dip, which has seen the market remain in a bullish phase this past week. 


On the currency front, we could see gradual Rand weakness as over the coming months due to the global interest rates rising. A Federal Reserve member stated interest rates might have to go higher than the 3% target to contain inflation in the future and an ECB policy maker indicated there will be an update on the timing of the end of the EU’s monetary stimulus programme. 


The week ahead: 

Last week’s movers and shakers… 

Best Performers: SNV 10.9%; CMH 6.2%; NPN 6%; NED 5.3%; EXX 5.3% 

Worst Performers: SGL -17.8%; SNH -16.2%; DTC -16%; IMP -14.5%; BAT -11.8% 


Other Economic data releases of interest… 


New Buy 

African Rainbow Minerals – in a sweet spot 


ARM was not spared from the sharp sell-off in mining related stocks during February and March.  However, a closer look at this company is justified; it has a June year-end and in the first half to December delivered strong results, EPS up 15%; Ferrous metals were the largest contributor to earnings, and although an anticipate correction in Iron Ore prices did materialize, Manganese prices remain firm. Nevertheless, Iron Ore prices have recovered and average prices for the second half should be higher that first half.  


Cost containment has been good across most of their operations, and we expect more good news with the next results announcement.  


The forward PE is approximately 7.1 and forward dividend yield of 4.5%. ARM typically provides a trading statement in mid-August with results out in September.  


We are buyers of ARM (JSE share code is: ARI) at current levels of R 110 per share.  


Short term Ideas 


Long Term Ideas