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The US markets were closed yesterday as many investment professionals took time off to celebrate with family and enjoy some Thanksgiving festivities. The holiday often leads to reduced global trading activity and market volatility as participants take a break. Locally, markets closed higher with industrials, miners and financials leading the charge, the big winners were Impala and Anglo Platinum. Gold stocks however were lower.

In corporate news, Barclays (LON: BARC ) is developing plans to reduce costs by up to $1.3 billion, which may entail cutting as many as 2 000 jobs. Elsewhere, retailer Spar issued a grim trading statement saying it expected earnings to tank 53% thanks to a botched implementation of the SAP enterprise software, shares were down 4.1% on the news.

At the closing bell, the JSE All-share closed up 0.90%, and the US markets were closed yesterday for Thanksgiving.

One thing, from Paul

It's Friday, the day I veer into amateur philosophy and life advice!

Erik Hoel made a good point in his column this week, timed with the US Thanksgiving holiday. He says: "I'm grateful that human life is long, and has many different stages, and that a good life consists of partaking of each stage as it comes, as if it were a course in a grand feast."

That's a good point. Barring an unfortunate disease or accident, we can expect to live for 80 years, which is a long time. Long enough to grow, change, experiment, succeed, fail, recover, build, invest, relax, love, procreate, and generally have a good time.

Byron's beats

When a share price drops, it needs to go up by a lot more in percentage terms to get back to even. Many of our favourite tech stocks have had a fabulous year in 2023, but that comes off a very poor 2022. For example, Meta (NASDAQ: META ) is up over 180% in 2023 but collapsed 64% in 2022. The net result is that it is flat over the 2 years.

Nvidia (NASDAQ: NVDA ) might be up 245% this year but it dropped by 50% in 2022. Over the period it is up 72%. Take a look at the image below which shows you the 2022 return, the 2023 return, and the combined 2-year return of many of the stocks that you own.

The moral of the story is that when picking individual shares you will most likely have to absorb big drawdowns. But be patient; if the thesis remains intact, they should recover those losses and some more. Also, buying into the dips does really help boost returns.

Michael's musings

As was largely expected, the SARB held South African interest rates steady at 8.25% yesterday. That means the Prime rate stayed at 11.75%, which feels much better than 12%. Even though South African inflation came in higher than expected on Wednesday, the SARB could keep rates the same thanks to a slightly stronger Rand , falling oil prices and slowing global inflation rates.

It means that we are probably at the peak of the current rate-hiking cycle. Phew. One thing that could change that though is the mess that the ANC and their cadres have caused at our ports. Thanks to all the containers being stuck at sea, we could literally be importing higher prices, which could force the SARB's hand to raise interest rates again.

Looking ahead, the SARB is pencilling in the possibility of three 25 basis point cuts in 2024, which means that Prime will drop to 11%. Still high compared to the extremely low rates that we saw during Covid, but roughly in line with longer-term trends.

Bright's banter

David Beckham has leveraged his successful football career to create a very successful new club. He exercised an option from his contract with LA Galaxy to purchase a new Major League Soccer team, at a discounted price, in 2018.

This led to the creation of Inter Miami, based in Miami, with Beckham and a team of business partners leading the charge. The team aimed to bridge the gap between North American soccer and global standards.

Inter Miami, benefitted from Beckham's celebrity status and quickly gained a substantial fanbase. They established partnerships with local businesses and engaged in community initiatives.

In recent years, the team focused on building up its roster, making a significant investment in July 2023 by signing soccer star Messi to a lucrative contract of $50-$60 million annually for a two-year period.

As a result of these strategic moves, Inter Miami's valuation has soared to $600 million in just under five years, showcasing the success of Beckham's vision and business endeavours in the soccer world.

Signing off

Asian markets are mixed this morning. Benchmarks fell in Hong Kong, mainland China, and South Korea; while they rose in Japan as they played catch up after a holiday.

US equity futures edged higher in early trade. The Rand is now trading at around R18.82 to the US Dollar.

Today is Black Friday, so it's essential to double-check whether the items you're buying are genuinely on sale, and that you actually need it. Retailers may employ various pricing strategies, and comparing prices or looking for additional discounts can help ensure you're getting the best deal. Happy shopping!

Have a good weekend.

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