MAKING CENTS
“Here’s what
happened
this week”
17 February 2017
Compiled by Tlotliso Phakisi and Jordan Weir
HIGHLIGHTS
The South African rand put on yet another outstanding performance against the US dollar this week, finally breaking through the
R13.00 level to see the rand at its strongest level in 20 months as it touched R12.90 on Wednesday. South Africa’s unemployment
rate came in at 26.5% against a previous 27.1%. President Trump had a positive telephonic meeting with Chinese president, Xi
Jinping, on Friday last week, where both clarity and US allegiance was given to the ‘Óne China’ policy. Following this, Trump also
met with Japanese president, Shinzo Abe, over the weekend. Not much has been disseminated from that meeting, yet overall
sentiment was positive as the Nikkei rallied for most of the week, while the US dollar strengthened against the Japanese Yen.
China has taken a radical stance against its globally known pollution problems, especially in Beijing. China has now officially opted
to take drastic steps in cutting the production of steel and aluminium, as well as coal usage and fertilizer factories.
CHART OF THE WEEK
Which Industries Attract the Most Venture Capital?
Source: Statista
Venture Capital. A term synonymous with the fledgling startup community. But how so?
In the hope of funding that extra mile of runway which could assist their respective venture take off into a profit
making business, startups seek out capital raised through various venture capital financing rounds. These however
come in various stages of the startup’s journey to making the ‘Big Time’.
 Seed Round – Capital raised by initial company insiders
 Angel Round – Capital raised through early outside investors who purchase common stock
 Series Rounds – Done through Series A, Series B, Series C rounds and so on, the progression of the startup
is monitored by the market value paid at these various financing intervals. Investors start to worry if the
common stock’s market value decreases as the series rounds progress.
 Mezzanine and Bridge financing – These are rounds of funding, usually in the form of a loan, which will carry
a startup between venture capital financing rounds and the eventual initial public offering.
With the rapidly changing world we live in, flanked by the swift progression of technology and diseases, it’s no
surprise that venture capitalists will more than likely be found dabbling in the software and biotechnology sectors in
2017. Of the $58.80 billion in venture capital funding invested in the USA during 2015, a combined 53.5% was
invested in biotech and software startups. This amounted to roughly $31.45 billion. The first half of 2016 saw North
American venture capital firms dripping just over $22.5 billion into blossoming businesses as well as merger and
acquisition (M&A) deals.
Yes, you guessed correctly. Mobile device–based application startups were right at the top of the entire spectrum as
some of the most valuable and promising startup investments in the world.
INDEX
INDEX
VALUE
YTD
1 YEAR
3 YEAR
5 YEAR
CURRENT
PE
LT AVG. PE
(10YRS)
CAPE
(7YRS)
JSE ALL SHARE
52586
3.1%
6.5%
12.8%
55.6%
22.8
15.0
17.9
33821
3.8%
27.8%
-40.7%
-36.7%
27.6
15.5
12.1
15321
0.8%
4.4%
24.8%
68.3%
13.2
13.2
15.0
66731
3.3%
-2.4%
25.8%
119.4%
30.1
16.9
29.0
RESOURCES
(RESI 10)
FINANCIALS
(FINI 15)
INDUSTRIALS
(INDI 25)
Performance period: 09/02/2017 – 16/02/2017
TOP 10 GAINERS – ACROSS THE JSE
COMPANY/STOCK
TOP 10 LOSERS – ACROSS THE JSE
%CHANGE
COMPANY/STOCK
%CHANGE
-10.0%
1
MURRAY & ROBERTS
36.2%
1
ANGLO AMERICAN
2
KAP INDUSTRIAL
16.0%
2
LONMIN
-5.9%
3
CLIENTELE
11.8%
3
REDEFINE INTERNATIONAL
-4.8%
4
ADCORP
9.5%
4
IMPALA PLATINUM
-4.7%
5
METAIR
8.3%
5
MPACT
-4.5%
6
RCL FOODS
7.7%
6
BRITISH AMERICAN TOBACCO
-4.4%
7
CONSOLIDATED
INFRASTRUCTURE GROUP
7.2%
7
WOOLWORTHS
-4.0%
8
PALLINGHURST
7.2%
8
AFRICAN RAINBOW
MINERALS
-4.0%
9
BRIMSTONE
7.1%
9
ALEXANDER FORBES
-3.7%
10
ZEDER
6.8%
10
STEINHOFF
-3.7%
QUOTE OF THE WEEK
"Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning."
~ Albert Einstein
DID YOU KNOW?
Left-handed people represent about 11 percent of the human population today, however, in the 1900, they made up
only three percent. So what causes someone to become left-handed? The answer is not quite straight-forward, but
research points an intricate collaboration between the environment and genes. It has been discovered that people
who dominantly use their left hands will likely have more left-handed family members.
(http://www.huffingtonpost.com/2012/10/29/left-handed-facts-lefties_n_2005864.html)
WEEKLY HIGHLIGHTS
Friday, 10th
Balance of Trade (January) | China
In January 2017, China reported a trade surplus of USD 51.35 billion. This was lower than the surplus reported
a year ago of USD 56.67 billion but ahead of market expectations of a USD 47.90 billion surplus. The main
contributor was a 7.9% rise in exports while imports surged 16.9%.
Monday, 13th
GDP Growth Annualized (Q4) | Japan
Japan’s economy grew at an annualized 1.0% in Q4 of 2016 and this was in line with market consensus of a
1.1% rise. The October-December results was the fourth straight quarterly expansion in inflation-adjusted GDP
showing signs that the economy is back on track.
Tuesday, 14th
Inflation Rate YoY (January) | United Kingdom
Consumer prices in the UK rose by 1.8% year-on-year in January 2017 after gaining 1.6% in the previous
month but below market expectations of a 1.9% increase.
Wednesday, 15
Thursday, 16th
th
Retail Sales MoM (January) | United States
Retail sales increased by 0.4% month-over-month in January 2017 following an upwardly revised 1.0% rise in
December and above market consensus of a 0.1% increase. Sales grew for gasoline stations, restaurants and
electronics and appliances stores
Unemployment Rate (January) | Australia
The jobless rate in Australia came in at a seasonally adjusted 5.7% in January, slightly less than the 5.8%
reported in the prior month and beating market expectations of a steady rate.
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