Market Overview
The following is a partial recap of the market analysis shared during today’s morning Discord call.
We start a new week, following a period of consolidation in the U.S. market, which only started to show momentum downwards on Friday. The semiconductors in particular seemed to have played a decisive role, as they dropped significantly and dragged the rest of the market with them. The action in the commodity market seems to be on the same track; however, metals are struggling while oil goes up to $85. and beyond, making the likes of Sasol (SOL) into an increasingly interesting option. But overall, we expect today to be a mostly calm prelude to the upcoming earnings and data releases, which are bound to shake up the local and international markets.
Tencent (700)
Tencent is up 3.25% from Friday’s close, a success shared by the broader Hong Kong market, with Hang Seng up by around 1.75%. It seems to have found a short-term bottom at HK$420, and is currently resting below the critical HK$480 level. It’s significant, as it has shown a tendency to slow down as the stock gets closer to the HK$480, and we expect it to see further movement to the upside if it’s able to close above it. Meanwhile, Naspers (NPN) and Prosus (PRX) are performing similarly to Tencent, with them having found a floor and appearing to be on the rise. The two also have gaps to close, which mark them as a potential investment.
From left to right: Tencent (700), Naspers (NPN), and Prosus (PRX).
Local Stocks
South32 (S32)
South32 had a good performance on its production numbers today, and it has subsequently gone up by over 4%. If it gains any momentum today, it’s likely to reach R48-50.
Mondi (MNP)
Mondi has had 2 up days in a row, finally breaking out as predicted. We believe R180 is very much a possibility.
Sasol (SOL)
With oil prices rising, Sasol is likely to continue seeing gains today. We recommend keeping an eye on this stock, especially as the company’s scheduled to release a production update tomorrow.
Earnings & Economic Data
Today’s relatively quiet in terms of earnings and economic data, with a Japanese holiday being the most noteworthy event. But the rest of the week is bound to be more interesting, with South Africa’s CPI figures coming out on Wednesday, and the likes of Tesla (TSLA) and Intel (INTC) having earnings during the week.
Pre-Market Earnings
AMC Entertainment (AMC)
AMC is the world’s largest movie theatre chain based in the U.S., which seems to have a large short interest at the moment.
Economic Data
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