The big story out of the US this past week was inflation at 7%, the highest since 1982. Opinion is divided with Viv Govender of Rand Swiss considering inflation, and how the Federal Reserve handles it, 2022’s biggest challenge for the global economy. It’s not that he Fed isn’t concerned, rather that managing inflation is hard and there’s no perfect play book.
I chatted with Evan Walker of 36ONE Asset Management about local listed retailers. He’s been very bearish, but social grants have helped the sector. He remains concerned, especially if the social grants are not extended in the February budget. Walker does caution that he is not yet shorting any retailers and considers Shoprite* worth holding as the standout preferred local retailer.
Last year, as our tourism sector was gearing up for a bumper year, a new variant saw boarders closed for travellers to and from South Africa. I spoke with Tourism Council CEO Tshifhiwa Tshivhengwa to get a sense of how busy the holiday season was since we all had to holiday locally. I also asked about the year ahead as the UK and other countries begin opening their boarders.
Local exchange-traded products (ETPs) had a great 2021 as total assets grew 22.5% and now total over R136 billion. I spoke with Mike Brown, MD at etfSA, about this growth and he pointed out that a lot of it was from exchange-traded notes. He also points out that the top three issuers (Satrix, Sygnia and Absa) all have around 25% market share making for a competitive market space.
*The writer holds shares in Shoprite.