Stock Watch - 22 May 2024 | The Close

Summary

In this insightful discussion, financial experts G Letter to Levy, David Shapiro from Sassman Securities, and Wayne McCurry from FNB Wealth and Investments delve into the intricacies of the stock market. They address a range of topics, including the strategic mergers and acquisitions in the mining sector, the potential for a commodity upcycle, and the influence of AI on the tech industry. The panelists also provide investment advice, with a focus on companies like BHP, Anglo American, and Nvidia, and discuss the current state of the South African Rand. They explore the impact of political stability on the economy and provide insights into the future of resource ETFs and the prospects of retail stocks like Target. The conversation is a testament to the dynamic nature of financial markets and the importance of staying informed in an ever-evolving landscape.

Takeaways

• 📉 BHP's Offer Rejection: Anglo-American has firmly rejected BHP's offer but has given them an additional week to improve it, indicating a potential openness to a better deal.
• 🔄 Finality of BHP's Offer: BHP has declared its current offer as final, not intending to make a better one, which raises questions about the future of negotiations.
• 💡 Shareholder Power: Shareholders have the ultimate say in major decisions like mergers or acquisitions, even if directors disagree.
• 📊 Market Analysis: There is a possibility of a commodity upcycle in the next few years, which could positively impact the South African Rand and share market.
• 🌐 International Influence: Decisions by companies like BHP are influenced by global factors and stakeholders outside of South Africa.
• 🔑 Future of Kumba: The future of Kumba, a subsidiary of Anglo American, is uncertain following the rejection of BHP's offer.
• 🛑 Uncertainty in Tech: Nvidia's results are seen as a bellwether for the tech industry and the economy, with expectations running high.
• 🚀 AI and Semiconductors: The demand for AI and semiconductors is increasing, with companies like Nvidia leading the charge in innovation.
• 💻 Market Sentiment: The 'man on the street' is becoming more interested in commodities like copper, indicating a potential shift in market sentiment.
• 🌐 Global Impact: The impact of AI is becoming more evident in everyday life, affecting how we live, shop, and entertain ourselves.

Q & A

What was the main topic of discussion regarding BHP and Anglo-American?

The main topic was Anglo-American's firm rejection of BHP's offer, but with an indication that they would consider a better offer if presented within a week. BHP, however, announced that their offer was final and would not be improved upon.

What does David Shapiro think about the potential merger between the two companies?

David Shapiro believes there is still a lot of discussion to be had and that the strategies of the two companies are quite similar. He suggests that many shareholders or investors might support a merger due to the potential for a strong focus on developing copper interests.

What is Wayne McCurry's perspective on the shareholders' role in the potential sale of their company?

Wayne McCurry explains that ultimately, the shareholders have the final say, even if the directors disagree. Shareholders can call a special general meeting and make decisions through proxy votes or actual votes.

What is the general sentiment regarding the South African Rand (ZAR) and its potential movement?

There is a belief that the ZAR could strengthen, possibly moving towards an overvalued territory if a commodity upcycle occurs over the next two to three years. However, this could change rapidly based on external factors such as US inflation or job reports.

How does David view the current situation with Nvidia and its significance in the market?

David sees Nvidia as a significant player in the market, especially as a pure play on AI. He believes that Nvidia's results could act as a catalyst for a market rally or at least allow the market to hold its current position.

What is the panel's opinion on investing in copper, specifically through companies like Copper 360?

Wayne McCurry is cautious about investing in single commodity companies like Copper 360, despite acknowledging the bright future for copper due to the move towards electrics and a lack of new big copper deposits.

What does the panel suggest about the potential for a commodity upcycle and its impact on the economy?

The panel suggests that a commodity upcycle could lead to a stronger Rand, a better performing share market, and an improved economy. However, they also advise to sell and take money overseas if things start looking better.

What is the discussion around selling South African bonds in anticipation of declining interest rates?

Wayne McCurry advises against selling South African bonds now, as they are yielding about 10% plus capital growth. He believes that if the Rand strengthens and interest rates fall, the value of long bonds will increase.

What are the panel's views on investing in resources ETFs, and which ones do they recommend?

The panel suggests focusing on the Resi 10 ETF, which includes major resource companies. They also caution against ETFs that include gold shares, as they appear to be topping out.

What stock picks do the panelists offer for the current market conditions?

Wayne McCurry suggests investing in US retail, specifically Target, due to the potential for a rebound in consumer spending if US interest rates decrease. David Shapiro recommends Roet, a company he believes is well placed for future changes and a good dividend payer.

Outlines

00:00

📉 Stock Discussion and BHP's Offer Rejection

The first paragraph introduces a stock market discussion show hosted by G with guests David Shapiro from Sassman Securities and Wayne McCurry from FNB Wealth and Investments. They discuss BHP's rejected offer for Anglo-American, with Anglo-American encouraging BHP to improve their offer within a week. The conversation hints at potential future developments in this corporate acquisition scenario, with speculation about mergers and the future of companies like Angloplats and Kumba.

05:00

💡 Insights on Market Trends and Commodity Cycles

In the second paragraph, the panelists share their views on market trends, with a focus on the recent strength of the rand and the potential for a commodity upcycle over the next few years. They discuss the impact of commodity prices on the market and the importance of being cautious about selling off assets too quickly. There's also a debate on the influence of 'the man in the street' on market sentiment and the potential for a market rally driven by major tech companies and AI advancements.

10:02

🚀 The Role of AI and its Economic Significance

The third paragraph delves into the significance of AI as a macroeconomic indicator and its role in the tech industry. The panelists discuss Nvidia's role as a pure play on AI and the potential impact of its results on market sentiment. They also touch on the broader implications of AI on society and the economy, highlighting the unstoppable nature of technological advancement in this area.

15:04

💼 Tech Sector Analysis and Investment Opportunities

In the fourth paragraph, the conversation shifts towards specific tech companies and investment opportunities within the sector. The panelists discuss the performance and potential of companies like Ultron and Datatech, with opinions on their current valuation and future prospects. They also consider the impact of political stability on investment decisions and the potential for a strong rebound in consumer spending.

20:06

🏦 Economic Forecasts and Investment Strategies

The final paragraph wraps up the discussion with economic forecasts and investment strategies. The panelists consider the potential for interest rate changes and their impact on bonds and the rand. They also provide stock picks and discuss the importance of understanding market cycles and historical performance when making investment decisions.

Keywords

💡Stock

Stock refers to shares in the ownership of a company. In the context of the video, it is the primary subject of discussion, with the panel analyzing stock-related questions and market trends. For example, the script mentions 'Stockwatch' and discusses the performance of various stocks such as BHP and Anglo-American.

💡BHP

BHP, or BHP Group, is a leading global resources company mentioned in the script as making an offer to acquire another company, Anglo-American. The term is significant as it relates to a major business development and potential merger, which is a central theme in the video's discussion on market activities.

💡Anglo-American

Anglo-American is a multinational mining company that is mentioned in the script as the recipient of an offer from BHP. The term is key as it highlights a significant corporate event, the acquisition offer, which is a focal point in the video's analysis of market movements and company strategies.

💡Merger

A merger refers to the combining of two or more companies into a single entity. In the video, the potential merger between BHP and Anglo-American is discussed, indicating a significant business transaction that could impact the stock market and the future of both companies involved.

💡Shareholders

Shareholders are the owners of shares in a company. The script discusses the power of shareholders in making decisions about company acquisitions, emphasizing their role in corporate governance and the final say they have over major decisions like mergers and acquisitions.

💡Commodity

A commodity is a basic good used in commerce that is interchangeable with other goods of the same type. The script mentions commodities in the context of a potential upcycle, indicating a predicted increase in demand and prices, which is a key theme in the discussion about market trends and investment opportunities.

💡Rand

The Rand refers to the currency of South Africa (ZAR). In the script, the Rand's value and its potential movements are discussed in relation to market trends, interest rates, and the performance of the South African economy, highlighting its importance in financial discussions.

💡Interest Rates

Interest rates are the percentage at which interest is paid by borrowers and paid to depositors. The script discusses the potential for declining interest rates and their impact on the economy and investment decisions, such as the timing for selling South African bonds.

💡ETFs (Exchange-Traded Funds)

ETFs are investment funds that are traded on stock exchanges, similar to individual stocks. The script mentions resources ETFs as potential investment vehicles, indicating a strategy for gaining diversified exposure to the resources sector without investing in individual stocks.

💡AI (Artificial Intelligence)

AI refers to the simulation of human intelligence in machines that are programmed to think like humans and mimic their actions. The script discusses AI in the context of Nvidia, a company that is a significant player in the AI industry, and its potential impact on the market as a leading technology.

💡Renewables

Renewables refer to energy sources that are replenished naturally and sustainably, such as solar or wind power. The script mentions Royet's involvement in renewables as a positive factor for the company's future, tying into broader themes of sustainability and investment in clean energy.

Highlights

Discussion on the potential merger between BHP and Anglo-American, with Anglo-American's firm rejection but openness to a better offer.

BHP's announcement that their current offer is final and they will not improve it, raising questions about the future of negotiations.

The impact of the merger on shareholders and the role of company directors in making decisions on behalf of shareholders.

The potential for a commodity upcycle in the next two to three years, affecting the Rand, share market, and economy.

The significance of Nvidia as a macroeconomic bellwether and its role as a pure play on AI.

The importance of AI and its growing integration into our lives, including shopping and entertainment.

The potential overhyping of share prices in the tech sector, despite long-term growth prospects for companies like Nvidia.

The performance of Royet and Ultron, with a preference expressed for Royet due to its positioning for future market trends.

The strategy regarding South African bonds with a yield of about 10% and the consideration of selling them in anticipation of declining interest rates.

The potential benefits of holding long bonds in a scenario where the Rand strengthens and interest rates fall.

Speculation on the political landscape and its effect on the economy, with predictions on the ANC's performance in the upcoming elections.

The viewer's question about investing in copper and the panel's opinion on Copper 360 as an investment.

Wayne McCurry's circumspection about smaller players like COA 360 in the mining sector.

David Shapiro's bullish stance on the market for the next six months to a year as growth returns to the global economy.

The viewer's question on whether to add Ultron to a portfolio, considering its recent good results and expansion plans.

The recommendation to consider resources ETFs that do not include gold shares due to their current high valuation.

Wayne's stock pick of Target for its potential rebound with lower interest rates and its status as a good retailer.

David's stock pick of Royet, citing its strong performance, good dividend payout, and favorable positioning for future market changes.

Transcripts

welcome back you're watching stock with

me G letter to Levy and joining me to

take your stock related questions this

evening or David Shapiro from sasman

Securities and Wayne McCurry from FNB

wealth and Investments if you'd like to

send questions please email Stockwatch

at bdtv do.a or Via SMS on 41392 and for

the time being we only have David

because I'm not quite sure where you is

um you know you'd think that he'd

remember 6:30 Wes trou yeah because I

haven't been here for a couple a week so

I'm not really familiar you know with

with the latest news so um Wayne Bettis

put out that smoke and just get onto get

onto get onto the TV yes yes he best he

had but actually there was a phenomenal

amount of news today um well um you you

had BHP and anglo-american

uh the offer there um which I found

quite curious actually it was it was a

firm rejection by anglo-american but

they said but we're going to give you

another week to put up or shut up so

that means I think that they would be

open to a better offer if if I had to

read between the lines and then BHP came

out with an announcement that they're

not this is their final offer they're

not going to make a better offer so I

wonder where that leaves us maybe that's

where we should start the show David

what do you think yeah it's I there's

still a lot of discuss to take place um

no one's quite sure how to approach this

because the strategies are are pretty

similar um I kept thinking I take myself

back and say okay if I was uh in the UK

or in America and uh I want to get

involved in Copper or I want to get

involved do I want two companies or do I

want one company so I I I actually think

there are a lot of shareholders or

businesses or uh investors should I say

that would say okay I you know we would

support a merger simply because it's

going to be a very you know a big

business with a strong focus with lots

of muscle to develop copper interests

whereas here it's pretty personal you

know it's uh I think a lot of ego

involved so I think one's got to keep um

the discussions open yeah in both cases

they're going to get rid of Anglo plats

deers you know Kumba I don't know where

Kumba is going to find its place or

whatever it is so uh yeah it's it's

something that I hope they don't put to

bed I mean discard straight away okay

and Wayne good evening to you um perhaps

I could mention a viewer's question

which relates to what you've just said

David and the viewer says I don't

understand how Ango the company can

decline bhp's offer to buy it surely

such a sale implies transfer of

ownership from the current owners that

is the shareholders to the purchaser

which would in turn imply that the

shareholders not the company should make

the decision or do the directors elected

by the shareholders have an automatic

mandate to make all the decisions on

their behalf including as Grave a

decision as selling their

shares the shareholders have the final

yeah yeah the shareholders have the

final save even if the directors

disagree BHP can approach the big

shareholders directly and they can say

yes even if the directors say no it's

unusual for that to happen because

normally the directors are

representatives of Fairly large Sher

base you know of of the company but yes

what the directors say or don't

say actually doesn't really count as

what the shareholders say so any

shareholder who wants to uh accept the

BHP you can call that that shareholder

can call a special general meeting and

get proxy votes or get actual votes and

you know the shareholders the

shareholders call the shots not the

director what the directors try and do

is to give the shers a fair value and

say uh you know this doesn't value the

company at at a price that we consider

would be fair and you get Outsiders to

come and value that and uh I think one

of the issues that Anglo did bring up is

that this whole process the BHP process

could take 18 months and that's too long

to wait so I I I I'm sure that they're

coming round and there's been a lot of

influence

um outside of South Africa you outside

of the PC perhaps maybe some of ours you

know some institutions here as well uh

to have a closer look and say what's

going to benefit us in the longer term

yeah um but way um BHP as I said to

David um came out with an announcement

it said it's this is its final offer

this is the final ratio that it's

offering and it said it would not be

increased unless there's an offer from a

third party so

well look it's it's quite possible but

you know final offers are final offers

until the next one comes you know the

first offer the first offer was this we

really think is a fair value for the

company it's this much of a premium

across the V whack over the last few

days and we really think that this is

generous and and then they come with

another offer that's higher and then

they come with another offer that's

higher so maybe this is the final offer

but as I said until the next offer comes

which may happen probably not but it may

happen yeah okay well we'll see just

generally your comments on the markets

way um we had the r going to 1804

yesterday and I thought oh I'm going to

buy myself some dollars and then it was

all the way back to 1824 actually by the

time we went on air

um if you had to beir into your crystal

ball where do you think we're headed um

and um and why do you think it's it's

it's got such a a bid is it the the jump

that we've seen in some commodity uh

prices over the last couple of

weeks well look I mean I am a complete

stuck record this could be the start of

a commodity Up Cycle that is coming over

the next two or three years I've been

quite consistent in saying that even

though I've been very early in in in in

talking about it but over the next two

or three years we should have a

commodity Up Cycle under those

circumstances our Rand does well our

share market does well our economy does

better and maybe this is the start but

it's these factors that are pushing the

r i mean it could reverse tomorrow if

bad news comes out on US inflation or

jobs or whatever that that that the

interest rate expectations get pushed

further out the interest rate cut

expectations get pushed further out so

this could all change tomorrow but maybe

this is the start and if I'm right and

we do get a commodity upcycle you know

the Rands in know fair value we've fair

value is probably 17750 to 17 so that's

the level I would expect the ran to go

to and if the if the future cycle is

anything like the past cycle the Rand it

will actually move into overvalued

territory so it may in fact strengthen

more than 17 or

1750 but just remember if I'm right and

the Rand does strengthen and our

commodity shares go up and everything is

looking much better don't forget to sell

and then take money overseas yeah yes

exactly um David your thoughts um and

and

generally the

stet yeah I I think grain's right I

think we're in the start of a some major

bull markets the signs are there and uh

you know when client starts saying to

you phoning up say I want to buy copper

you say okay you know this is a good

sign when when all when all of a sudden

they want to go buy a copper bar or

something like this where can I buy

copper because the and and and I I have

great respect for for the man in the

street you know because they don't part

with their money that easily you know

even though we do say that they think

about these things and when they start

talking about copper just shows you that

the story is having some impact so I I I

think and rates are going to come down

inflation is going to come down it's

going to start easing you know it's it's

a rate of change and that rate of change

is going to slow down so I'm I'm quite

bullish on markets for the next six

months to even going into next year you

know as as growth comes back into the

global economy the

problem but the problem David

sorry keep going now I was gonna say you

talk about the man in the street I'm The

Man in the street and when you start

noticing something it generally tends to

mean does it not that the thing is over

so if we stop noticing that uh the

copper prices are 40% we're too late no

you're you're you're early they they

generally right they just get it wrong

at both ends you know they never know

when to sell and they never know when to

buy kind of thing you know you know what

I mean it's but along the way they

they're quite good they're quite good

predictors so we've seen copper going up

now so they didn't get it right at the

bottom but they they you know they want

to be part of all of this so I think um

I can see a lot more activity and uh

people are getting more confident and

going out there and now starting to

suggest equities you know you finding

competition coming in

um suddenly clients are saying you know

I spoke to so and so and uh he told me

to do this and I should be it should be

doing that and this so you can hear the

conversation changing and and I think

it's a good sign and um um it's not

going to be too long before us starts to

talk about reducing rates you know the

economy is starting to Teeter a little

so Wayne's right you know he's going to

be and the Rand sorry the point is that

the Rand will go to 17 7050 no doubt and

could be there by next week two weeks

time I mean just on that point of David

we must understand how quickly things

can can turn I mean I'm looking at my

chart here end of April thec was going

to get 40% the MK was going to get 15%

the eff was going to get 15% that we

going to have a governing govern

Coalition between thec the eff

everything was just absolutely going to

be a catastrophe and the Rand was just

going to weaken I mean it touched 172

1925 and literally in a month in less

than a month it's threatening to go

through 18 these things can swing

quickly positive and negative yeah just

a question on copper um and uh a

you exactly and he says I've come across

copper 360 so specifically and we have

spoken about this but this is a new

question from a VI I so far I like the

investment case I'd just love to hear Mr

mccurry's opinion on buying copper he's

he's always bullish on the mining

companies not necessarily Wayne I think

you're bullish when when you see that

that things are changing um it's still a

small business I do see a lot of

potential there also I'd like to get the

panels opinion on African rainbow

minerals way you're actually quite

circumspect about a smaller player like

COA 360 aren't you yes I first of all I

don't really like single single

commodity companies the future for

copper is fantastic

this this move to electrics and off of

it is so good for copper and there's

been no real new big copper deposits

coming on stream but the problem is the

copper price is essentially at record

highs yeah I know it's come off a little

bit now but it is essentially at record

record highs so maybe it goes up a

little bit more maybe it stays at these

levels the longer term Outlook is good

copper 360 you know I like companies

that

produce income that have been around for

a very long time I'm not really a a

startup company kind of guy I like

companies that have been through the

thick of it through Cycles through the

bottoms through the tops that have

really proven their metal that's you so

I'm I'm always a little bit concerned

about startups I I I don't like it but I

mean I could be so wrong and I fully

realize that as well yeah okay why not

take a p uh so David this time last year

it was Nvidia day and I suppose it is

today Nvidia day and I um you know I

like to single out John auur he's the

Bloomberg writer and he had a long uh

write up about it today and he said

rightly or wrongly Nvidia has kind of

assumed this significance of sort of

macroeconomic bell weather which is

probably incorrect but it is you know a

pure play on AI I wonder um if it does

well in its results do you think it's

going to be a further Catalyst for a

market

rally um it's going to hold you know at

least allow the market to hold where it

is but um I'm sure they will meet their

expectations or meet the huge

expectations that the market has put on

it uh the problem is where do we go to

from here they still well ahead of the

market they're still producing chips

what is quite incredible is that they

continue to produce these semiconductors

that are going faster and faster or you

know processing more and more data each

time and uh and and very necessary and

there's a shortage of it so I it's going

to be an interesting number to go

through you know to give you an

understanding of what the demand for AI

is um and you know you're seeing this

from the big businesses from from the

major tech companies just how much they

are spending so I it's this is a real

story it's I listened to an interview

with them yesterday um you know with

Jensen Wang and when you listen to what

is entailed it's almost a complete

Revolution you know of of the way that

people process information so um yeah

it's an important number but I just hope

that we haven't over uh overestimate you

know got too carried away yeah because

Wayne as as um a point has been made

that AI is also a cost companies are

going to have companies who want are

concerned about being left behind in

terms of computing and yes and companies

not tech companies who everything is

about AI are going to have to spend huge

amounts of money on the companies like

in video so it's not a it's not a um you

know there is an unequal relationship so

don't uh you know so take it's all it's

all I mean it's very interesting you

know the the fourth Industrial

Revolution and all of that came bar to

the FL at Davos how many years ago 6

years s years ago it's only now really

having an impact on our lives and that

is AI so AI is there to stay it is going

to become more and our lives are going

to become more and more involved with AI

how we shop how we entertain

ourselves essentially how we live um so

there's no stopping there's no stopping

this it's like the move to Electric

there's no stopping it it might take

longer than what you expect to take but

there's no stopping it doesn't mean the

share prices might be overhyped

initially but longer term clearly

companies like Nvidia and Taiwanese

semiconductors and all of these

companies if you do get serious price

weaknesses because of something that

went wrong somewhere then you must buy

some more because these are clearly

leaders in their field and the only

thing that can really go wrong with

these companies is the share price yeah

okay sticking with the sort of uh Tech

theme um a viewer asks is Ultron at

current price uh worth adding to a

portfolio the results were quite good it

seems that net star will be growing in a

couple of overseas countries too uh

datatech also in the it sector are

mentioned as a buyer by some of your

panels or any other preferred share in

the segment they're not strictly I

companies I suppose um Hardware

maybe it's funny I liked I looked at

rut's results because they were always

and I like it and I recommend it you

know it's my choice deny simply that I

think they're well placed very very well

placed for what lies ahead I prefer it

to Ultron that's what that's where I'm

coming uh so you prefer royet to Ultron

to Ultron y okay they've always been

similar kind of companies although I

think um you know um

royet uh had had a few problems with

their National aside today and the and

but but elron also had

various uh they were at what were they

Xerox and you know it was they also had

the cable side royet had the cable side

but you know when I look at them today I

think I prefer where um you know where

Roy Nots going um going through their

numbers and if you look at the chart

it's pointing in the right direction um

they're also all now in Renewables you

know in solar power and so and so so

yeah it is a nice area we need a little

bit of help from the econ

but um you know they the company's kind

of Wayne mention they've got history you

know they've had history so it's they're

not newcomers to uh to the market

yeah David and I remember the old elron

which wasn't good yeah old Elon wasn't

good but that's changing me I can

certainly remember roet used to make

locomotives yeah ryed is a sort of an

interesting case in a company that is

adapted um but but but to the viewer's

question I mean specifically on Ultron

and dat Tech um so Ultron actually you

can also see it's had a nice uh Spike

high in the sh price D would either of

you consider

it I don't know enough about dat really

I can't comment on

dock and and not Ultron per se I mean

interestingly enough the the man who I

think uh set Ultron on the right course

is also the current chairman of escom

umti

um would you I think I think on the last

results and as as the viewer said the

last results were

good okay yeah they battled a bit after

after um unbundling bites but uh and

bites I like bites as well but um you

know and looking at that area that's why

I'm saying when I when I do a comparison

I prefer to you I prefer Ro it which is

in a way supporting Elon although you

know supporting the area that it's in

yeah yeah okay um moving on there's a

question asking should I sell part of my

South African bonds which yield about

10% a year plus Capital Growth for uh

for the Advent of declining interest

rates to invest in offshore equities and

bonds uh and to take advantage of the

cover lower Rand exchange rates I need

to increase my offshore exposure to

above 70% over

time uh Wayne would you sell now not the

time now's not the time to do it if if

interest R of foring the r is going to

strengthen you interest rates falling

doesn't affect your long Bond your long

Bond's driven by the market in fact your

Capital goes up yeah your Capital goes

up yeah you make a capital profit very

simplistically The Reserve Bank in sa

will get inflation to average 4% they

will do it whatever the cost is they

will do it you're getting 10% on your

bond uh a sustainable real yield on the

bond shouldn't in theory be more than 4%

so you got a 2% you got a 20% potential

capital gain coming plus you're getting

your 10% heal that's not bad okay so

don't say men something interes you know

Wayne was when he was uh talking earlier

he mentioned where the Rand was you know

thec is going to be 40% and so on and uh

whether we like it or not whether it

suits our own personal views on the

country or something I think thec is

going to come in with their 50% and

they'll still be there which is um sorry

to disappoint everyone I think they're

going to get their 50% they'll still be

in charge without a coalition and what

that will do is uh it's going to steady

the nerves of foreigners and you'll find

rates probably coming down the r

strengthening on the back of that simply

because there's no uncertainty you know

you're not going to bring some uncertain

parties in as well so I think from that

point of you stick around you know if

you're in Long bonds I think you're

going to get a good ride there and

somewhere down the line you might uh you

know sell them and transfer the money

yeah okay that's depressing because the

station qu is exactly I'm not that's

what I'm saying you know you got to read

the tea leaves it was interesting I

listen to a chapping interviewed like a

phoning program on the radio and the guy

said no he's going to vote ANC because

it's better the devil you know

yeah I think so and they've got they've

suddenly found the money you know and

are they going out there and all of a

sudden they're doing what they should be

doing campaigning and making all the

kinds of promise to their to their

people and that so just just watch it

you know they're they're quite an engine

when they want to be an engine yeah

absolutely it's just if only they were

an engine in in good governance that

that would be quite nice um very quickly

a says which resources ETFs would be

good resources buyers today just the

resi 10 or do you think they

are or am I just

Focus no probably the resi 10 because it

gives you you know gives you all the big

ones yeah yeah I don't know don't know I

don't know what what ones are available

but I would try to find one that doesn't

have gold shares in

it because they looking very

topish yeah and you can you know even if

you buy one of even if you buy buletin

and glenor or something rather than an

ETF it's it's maybe a you're getting the

kind of exposure that you really

need um I don't know I I I I haven't

bought a resource ETF you know if if any

portfolios I would have probably

buletin you anyway yeah which doesn't

unfortunately give you exposure to all

to all resources okay well I'll get you

stock picks um so David you've already

sort of party given us but maybe you can

add something there but I'm going to ask

Wayne first in that case Wayne what are

you going for this evening I'm going for

the US retail a Target I mean I know the

share price is being hammered but it's

it's actually David and I don't have a

cup of tea or a cup of coffee or a

Johnny blue before the meet before the

the TV but what he said was very

relevant he said the US is showing signs

of slowing down a little bit and that's

exactly what Target said they said you

know we've had to cut prices on 5,000 or

10,000 line items because the consumer

under a bit of bit of strain there but I

mean that's not the reason why I'm

buying the share is that if you get

lower interest rates in the US and it

comes quicker than anticipated there'll

be quite a strong rebound of what may be

a lower base in consumer expenditure and

targets not expensive I mean this is a

very good retailer and the previous four

quarters they well outstripped consensus

earnings just in this quarter that

wasn't up to consensus could maybe

consensus was just too high given the

higher interest rates in the state of

the economy so maybe hold off the share

prices for morning now but I'd go for

Target okay um and David would you just

pile into roet now I have to say I own

roet shars um I bought them last year

I'm very happy that I did because

they've been a really great buy a good

dividend payer I just uh I I think if

you break down where they are um and

understand that um things are going to

change you know I even if they even if

we do have thec again I think slowly

things are going to get better money has

to to be spent and they they're just

well placed um they've just got those

kind of businesses that are going to

benefit and what gave me the clue was us

after the results came out I looked at

the you know the chart and that's that's

at a four fiveyear high you know and

it's just creeping up all the time okay

I can buy that petty you didn't buy it

four years ago but there you

go all right we shall leave it there and

welcome back to sa Shores um David

Shapiro is from assment Securities when

MCC is from FNB wealth and Investments

up next we have the close stay with us