It is the time of year when Friday mornings proceed to the background noise of 30 ill-tempered guys squabbling over a rugby ball on some Antipodean island.
There’s scant matching excitement from the market. There has been some attempt to continue with the amazing bounce that took place a week ago but the all share index shied away from bursting through the 20 000 level again. There were a few new smallish listings earlier in the week, of which Wearne (Readymix cement and aggregates looks the most promising). The only research I have done for this comment is from noticing how much building is taking place. Cement sales are stratospheric.
Car sales are too. Transport Minister Radebe revealed that there are almost 7m vehicles on our roads. Apparently, trucks and minibuses comprise just 4% each of this fleet. Why then is there always one of them in front of me or overtaking me on the inside? A quarter of the vehicles are “bakkies”. Probably carting all that cement and bricks.
Next week we are to have a midweek holiday to give us the opportunity to amble round to the polling station and vote in a local government. One poster that has blossomed on the lamp posts invites me to cast my vote for people who will “make local government work better”. This seems plausible until you realise that the fellows pursuing this line that are the very ones who have already been running the city for a decade. My vote would go to the team who promises that we would again see traffic cops (remember them?) enforcing trivial things like stop streets, red lights, turn-only lanes and one-way streets. Anyway, we all lose a work day in which to earn the money from where to pay the rates that keep these councils in the style to which they are getting quickly accustomed.
The local Business Day newspaper has launched an attack on the power of the internet to deliver investment information. Half a dozen pages of “Market Wrap” bombards the reader with more figures than anyone could ever use. The only thing I learned from it all was that the JSE’s own interest rate instrument market – Yield-X – is totally moribund. Not a single trade took place yesterday. Once upon a time I was an active player in the well established Bond Market of SA, (which ironically was began life in the early eighties in the JSE itself). I have watched many failed attempts to give the SA bond market what it didn’t want. Yield-X is just the latest. Bond people don’t like being told how or what to deal.
Back in “Market Wrap” however, I think that the section labelled The Forecast Factory” may prove popular with investors. For a selection of companies, it provides the average of forecast earnings supplied by a number of research teams around the country. The final column states whether the share is a buy, hold or sell. There are VERY few sells! I hope someone keeps a score card of success rate of this feature. I predict 50%.
According to the convenor of the selectors of the national cricket side, “the tour to Australia did not go according to plan”. Is that so? Now what is the plan for this evening’s Pro 20 circus down at Wanderers?
James Greener
24th February 2006
