Market Overview

The following is a partial recap of the market analysis shared during today’s morning Discord call.

Friday was a rough day for metals, following an overreaction by the market amid fears that the U.S.-Iran deal might fall through. We also heard news of President Trump threatening to launch new strikes against Iran over the weekend, which makes us believe that we’re seeing a continuation of the old reliable. With back-and-forths occurring simultaneously with ongoing peace talks, as the market seems increasingly used to. We subsequently speculate that the move upward will be tame when the final peace deal is signed. We could even see things go down due to profit-taking.

Tencent (700)

Tencent drops by another 1.5-2% today. It seems that news of the early implementation of its new A.I. service does little to turn around its fortunes. This does not bode well for Naspers (NPN) and Prosus (PRX). They rely heavily on the Hong Kong giant, and are likely to struggle, as Tencent has lost nearly all of its gains from the beginning of June. It’s worth noting that this coincides with a greater trend, where Japan and South Korea receive the buys, while Hang Seng (Hong Kong) is sold.

Local Stocks

Goldfields (GFI)

Goldfields tanked on Friday, as the future of its lease on Ghana’s Tarkawa mine is at risk. We expect gold miners like AngloGold Ashanti (ANG) and Harmony (HAR) to bounce today. But it’s unlikely for Goldfields to bounce as far, as their drop is due to bigger factors than just the gold price.

Standard Bank (SBK)

We saw much of the flow go into banks on Friday, with most of them performing well, though some of the gains were lost near the end of the session. Standard Bank in particular traded near all-time highs, and it had a good pre-close update this morning. But with the stock trading at swing highs, this can used as a liquidity event. We recommend keeping a close eye on where things go today.

Mondi (MNP)

Mondi was removed from the FTSE 100 on Friday and moved to the FTSE 250. We expect it to bounce in the coming days to weeks.

South32 (S32)

South32 dropped on Friday, with R46 being a possibility if it continues to go down. But it has found support around this level before, which could be an opportunity to long, if you are a more adventurous trader. We recommend setting a stop-loss at the R48.0 mark.

Economic Data

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