The Indian jungle

  • Market Overview

Market scorecard

US markets took a breather yesterday after trading in a narrow range for most of the day. It didn't help much that Fed Chair Jerome Powell hinted that they would probably wait a bit longer before cutting interest rates than they previously anticipated. The Dow surprisingly snapped its six-day losing streak.

In company news, UnitedHealth (NYSE: UNH ) rose 5.2% after beating earnings expectations, despite a system-wide data breach by hackers. Elsewhere, Morgan Stanley's (NYSE: MS ) stock went up 2.5% following a solid first-quarter earnings report, with a noticeable increase in investment banking revenue. Bank of America (NYSE: BAC ) didn't fare as well, falling by 3.5% after revealing an 18% decline in first-quarter profit.

In short, the JSE All-share closed down 2.04%, the S&P 500 fell 0.21%, and the Nasdaq was 0.12% lower.

One thing, from Paul

Looking after other people's money is a big responsibility. Vestact is a private client asset manager, so we deal with real people's savings, not funds sent to us by obscure institutions.

We have 1 228 unique individual investors, each with their own back story. Some are active savers, sending out what they can, when they can. Others came into some capital from a transaction or an inheritance and are trying to grow that nest egg. Another group are in what we call "withdrawal mode", funding their retirement or other projects.

Ben Carlson says "The only client question that matters is: "Am I going to be OK?"

We can't control the market, but we know that it goes up over time. We can't change your own circumstances, but we can look after your assets carefully, avoid obvious risks, buy you shares in good companies, and be here when you need us.

So yes, you will be OK.

Byron's beats

In 2018, Indian-based online retail company Flipkart was sold to Walmart (NYSE: WMT ) for $16 billion. We followed the deal with interest because Naspers (JO: NPNJn ) owned a stake in Flipkart and our clients owned Naspers shares.

Amazon (NASDAQ: AMZN ), another Vestact stock, were also bidding for Flipkart at the time but eventually lost out to Walmart. After that, Amazon decided to grow in India organically and invested a lot of money in setting up its own online retail business from scratch. Fast forward to 2024 and Amazon has just claimed the top spot for site traffic in India for the first time.

They have also just launched Bazaar, a new low-priced e-commerce site that will sell fashion and home goods in the price range between $3 and $7.

Amazon's execution has been incredible over the years. Their success so far in India is testament to the high standards they set for themselves. It is good to be a shareholder.

Michael's musings

In 2020, Amazon ordered 100 000 Rivian (NASDAQ: RIVN ) electric delivery vans. These vans are part of an effort to reduce carbon emissions from their businesses, and so far, 13 500 vans have been delivered. I've never thought about the systems behind charging all those vehicles.

Amazon is now the largest operator of private electric vehicle charging infrastructure in the US. The company has 17 000 charging stations at about 120 warehouses. It hasn't been easy going though, in many locations they need to coordinate with different utility companies to upgrade the local electrical infrastructure.

Building the charging network and buying the electric vans is more costly than buying conventional vans on the market. Electric vehicles are much cheaper to run though, which benefits Amazon in the long run. More importantly, you have to start somewhere. With each new installation, Amazon learns, builds scale, and reduces costs. Sounds good.

Bright's banter

In the first quarter of 2024, Samsung (KS: 005930 ) snagged the top spot of smartphones sold with over 60 million devices shipped, boosted by its Galaxy S24 series launch.

Apple (NASDAQ: AAPL ) slipped to second place with 50.1 million iPhones. This dip follows a strong showing in December when Apple briefly led the smartphone market. Apple is still more profitable per phone than the rest of the competition.

Chinese brands like Huawei are gaining ground, while Xiaomi claimed the third spot. Apple's struggles in China continue, with shipments there shrinking by 2.1% in the last quarter of 2023.

Looking ahead, Apple's Worldwide Developers Conference (WWDC) in June is expected to bring some excitement with new software updates. Investors are also keen on Apple's low-key AI development plans.

Signing off

Asian markets are mostly down this morning, and close to erasing year-to-date gains in most regions. Benchmarks fell in Hong Kong, Japan, and South Korea while they rose in mainland China. India's stock markets are closed as they observe Rama Navami.

Locally, Volkswagen Group Africa (VWGA) is gearing up for a significant R4 billion investment at their Kariega assembly plant in the Eastern Cape. They plan to build a new car there by 2027, a compact SUV developed in Brazil.

US equity futures are edging lower pre-market. The Rand is trading at around R19.02 to the US Dollar.

Today, ASML (AS: ASML ) and Abbott's Labs (NYSE: ABT ) will report their first quarter earnings.

Over and out.

Original Post

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or

100