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Welcome to the Sharenet Daily Equity Report
 Issue: 19 January 2011 20:00

Global market update

The “January barometer” or maxim is “As January goes, so goes the year.” If this saying extends to the prior month of December, then 2011 will be a strong up year, because global markets were very firm in the last month and quarter of 2010.

For a US dollar investor, equity investments both in the US and across most of the world performed very strongly. Part of this was clearly due to the depreciation in the dollar against other currencies.

Bill Miller of US based fund managers, Legg Mason Capital Management, in a report at the end of 2010 commented on what would bring the investing public back into equities and away from bonds.

He noted that while the investing world idolizes Warren Buffett, they almost invariably ignore his investing advice. In 1974 near the bottom of the market, Buffett noted how cheap stocks were. In 1999 near the top, he opined that stocks would see returns way below those experienced in the bull market up to that time. In October 2008 near the bottom, in an article titled “Buy American. I Am” in the New York Times he told people to buy American Stocks. In October 2010 he said “It is quite clear stocks are cheaper than bonds. I can’t imagine anybody having bonds in their portfolio when they can own equities.”

According to Miller, people poured money into bonds and sold equities. He then asks “So what will bring the public back into stocks?”

Answering his own question, he says, “The same thing that always does: higher prices.”

Locally many fund managers are also stating things like “Offshore equity is our asset class of choice”

They are not alone and a January 2011 report from Legg Mason, notes that many US based investment managers are becoming more bullish in their assessment of prospects for 2011. In the last few months, the bullish camp has gotten very crowded, which, in the short term at least, can be a negative indicator.

2011 is also a third year of the presidential election cycle and according to the report one has to go back to 1939 to find a pre-presidential year in which the S&P500 declined.

He notes that “People have been buying bonds, not because they have necessarily considered the risks and rewards of ownership, but because they have gone up so much over the past 30 years.”

Fair value for US bonds

According to BCA Research, a long standing independent research business, “The prevailing market consensus has swung quickly in favour of better economic growth.” They go on to say that a steady flow of capital has supported share prices and the year has got off to a good start.

Source: BCA Research

Liquidity drives prices and importantly the US Federal Reserve, as the main source of global liquidity, has a commitment to its existing stimulus plans. There is therefore a very low possibility of interest rate hikes in the US this year.

This in turn is positive for risk assets, which is exactly what the US Federal Reserve wants – i.e. to raise asset prices, increase confidence and stimulate spending and hiring.

BCA go on to say that equity prices only start to run into trouble when Treasury yields creep above fair value, which according to their models is currently 4,1%.

The yield on US bonds picked up in the last half of 2010 from 2,4% to around 3,4% - see chart below of the US 10 year Treasury yield. This is therefore still off fair value and investor should not be rushing to buy bonds – quite the opposite

US 10 year Treasury Yield

Source: Yahoo

Possible impediments to a bullish world in 2011

Some possible risk factors that could strain a generally bullish outlook for global markets, would include the following:
• A sharp and more unexpected rise in longer term interest rates
• Oil price moving up too quickly beyond $100/barrel
• A sharper slowdown in the US
• Re-escalation of sovereign debt crisis in Europe.

In general then our longer term view remains one of taking advantage of the relatively attractive values of global equities and where possible and necessary, reducing exposure to asset classes such as bonds which remain unattractive.

Kind regards

Ian de Lange
021 9144 966

Wed, 19 Jan 2011

South African government bonds extended losses on Wednesday and yields touched six-month highs as retail sales and inflation data bolstered expectations the Reserve Bank will keep rates on hold on Thursday.  Full story
Grimy old Fiats and Ladas have long been a defining feature of Cairo's creaking taxi fleet, clogging the city's streets and sputtering out fumes.  Full story
Russian Vimpelcom's bid for Egyptian tycoon Naguib Sawiris' telecoms assets has reignited a feud between its two top shareholders -- Norway's Telenor and Russian billionaire Mikhail Fridman's Alfa Group.  Full story
Developing countries and economies in transition together attracted more foreign investment than developed countries in 2010 for the first time, a United Nations study showed on Monday.  Full story

16h58 South African mobile operator MTN and insurer Sanlam said on Wednesday they have teamed up to offer health services through mobile. . .  Full story
16h19 South Africa's rand fell more than 1.2 percent to a six week low against the dollar on Wednesday and government bonds. . .  Full story
16h14 Mergers and acquisitions activity in sub-Saharan Africa surged to a record $44 billion in 2010, double the value of a year. . .  Full story
13h56 South Africa's retail sales growth expanded more than expected in November as consumer demand improved, further reducing lingering hopes that the. . .  Full story

Trading Statistics


Major Moves Up
SharenameSaleMove% MoveVolume
1 MMG  1553933.62.%112375
2 CBH  3513912.50.%128400
3 AME  37003008.82.%200
4 JUBILEE  394318.54.%458164
5 AFRO-C  174138.07.%27762
6 LONAFRIC  210105.00.%267
7 BELL  1175554.91.%13062
8 HUGE  11054.76.%30000
9 ALTRON-P  27441033.90.%277098
10 ALTRON  28501003.64.%77853
11 PALLINGHT  465153.33.%467239
12 PARACON  19163.24.%100
13 RA-HOLD  361113.14.%3000
14 PLATMIN  670203.08.%3000
15 DCENTRIX  559152.76.%6323
16 HARMONY  79682132.75.%803407
17 NEPI  2975782.69.%138462
18 FREEWORLD  1144292.60.%83604
19 GBGOLD  1814442.49.%49463
20 HUDACO  85362052.46.%101307

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Major Moves Down
SharenameSaleMove% MoveVolume
1 BAUBA  200-45-18.37.%3500
2 RANGOLD  270-50-15.63.%6400
3 S-OCEAN  218-17-7.23.%11182
4 ARGENT  911-69-7.04.%30700
5 BRAIT  2390-125-4.97.%528028
6 WESIZWE  218-11-4.80.%403589
7 SACOIL  153-7-4.38.%1094355
8 JDGROUP  5301-229-4.14.%1691448
9 SENTULA  270-11-3.91.%1120542
10 KEATON   400-16-3.85.%216756
11 JASCO  135-5-3.57.%62698
12 LEWIS  7341-259-3.41.%377959
13 MRPRICE  5995-205-3.31.%2525474
14 ERBACON  126-4-3.08.%5000
15 CAPITEC-N  4100-127-3.00.%24686
16 OANDO  325-10-2.99.%8000
17 VERIMARK  165-5-2.94.%37982
18 RICHEMONT  3842-115-2.91.%7250217
19 CLOVER  1060-30-2.75.%209476
20 A-V-I  3015-85-2.74.%223040

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New Highs
SharenameSaleHighMove% MoveVolume
1 BELL  11751200554.91.%13062
2 AFEAGLE  15515831.97.%50000
3 SASOL  36160364435601.57.%2576298
4 URONE  40274099571.44.%36964
5 METOREX  58660081.38.%3968924
6 ASSORE  20200204902501.25.%91663
7 KUMBAIO  47010474903600.77.%398399
8 BILLITON  27600277891000.36.%3215433
9 EXXARO  1555015925-50-0.32.%1835720
10 ANGLO  3618136850-318-0.87.%2081590
11 WBHO  1350014449-150-1.10.%68554
12 BARWORLD  67006855-139-2.03.%1061226

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New Lows
SharenameSaleLowMove% MoveVolume
1 RANGOLD  270270-50-15.63.%6400

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Spot Prices
NameTimeRPMove% Move
JSE Overall17:0032363.75-195.97-0.60%
JSE Top 4017:0029013.19-179.36-0.61%
JSE Gold17:002592.0435.201.38%
JSE Financial17:0021753.62-130.12-0.59%
JSE Industrial17:0031890.07-425.32-1.32%
JSE Indust 2517:0026433.08-390.26-1.45%
JSE Resource17:0058070.6666.370.11%
DJ Futures20:0011765.00-46.00-0.39%
DJ Ind19:3111818.67-19.26-0.16%
SP 50018/011295.021.780.14%
FTSE 10018:355976.70-79.73-1.32%
All Ords07:364944.2032.600.66%
NZSE 5006:363346.022.280.07%
NameTimeRPMove% Move
Gold/R kg20:0030774542411.40%
Brent Crude19:5697.62.130.13%
Rand / Dollar19:596.98340.08711.26%
Rand / Pound19:5511.12880.13321.21%
Rand / Euro19:559.41480.16581.79%
Rand / NZD19:585.38680.06481.22%
Rand / AUD19:556.99850.11671.70%
Yen / Dollar19:5981.9200-0.6800-0.82%
Euro / Dollar19:550.7411-0.0057-0.76%
Dollar / Euro19:591.34800.00950.71%
Pound / Dollar19:550.6253-0.0009-0.14%

Click here for the Sharenet Spot Price page
Index Summary
Index NameRPMove% Move
Top 4029,013.19-179.36-0.61%
Mid Cap42,562.91-233.90-0.55%
Small Cap33,484.21-149.78-0.45%
Resource 2058,070.6666.370.11%
Industrial 2526,433.08-390.26-1.45%
Financial 158,231.99-56.93-0.69%
Financial & Ind. 3029,859.23-385.61-1.27%
All Share32,363.75-195.97-0.60%
Oil & Gas 27,406.63420.951.56%
Mining 38,296.43-34.94-0.09%
Gold Mining2,592.0435.201.38%
Platinum Mining86.29-.90-1.03%
Oil & Gas Producers 14,736.04226.341.56%
Basic Materials 32,167.49-21.15-0.07%
Chemicals 13,611.4741.710.31%
Forestry & Paper 13,318.29-24.02-0.18%
Industrial Metals 30,096.16132.480.44%
Industrials 29,762.34-74.01-0.25%
General Industrials 77,681.26-293.46-0.38%
Consumer Goods 25,918.08-457.65-1.74%
Automobiles & Parts 2,898.51.000.00%
Household Goods152.65-0-0.12%
Health Care 32,502.14-111.67-0.34%
Beverages 82,012.56-1062.74-1.28%
Food Producers 48,568.49-566.13-1.15%
Index NameRPMove% Move
Personal Goods 383.72-11.49-2.91%
Consumer Services 52,976.95-801.70-1.49%
General Retailers 39,207.53-735.46-1.84%
Travel & Leisure 4,174.22-17.78-0.42%
Media 87,516.09-1246.33-1.40%
Support Services 2,672.91-6.63-0.25%
Telecommunications 61,930.82-1450.85-2.29%
Financials 21,753.62-130.12-0.59%
Banks 40,950.35-494.90-1.19%
Non-life Insurance 31,523.82-36.37-0.12%
Life Insurance 15,859.0647.550.30%
General Financial 2,406.91-24.08-0.99%
Technology 21,055.7069.590.33%
SHARIAH TOP40 3,278.01-7-0.22%
FTSE/JSE SHARIAH ALL3,343.50-6-0.19%
COAL MINING21,452.76-20-0.09%
FTSE JSE Fledgling 4,755.60-33-0.69%
FTSE/JSE Alt X 1,135.79-0-0.02%
CAPPED PROPERTY 311.40-0.03%
RESOURCE 31,948.40360.11%
DIVIDEND PLUS174.99-1-0.57%
FTSE/JSE RAFI 406,746.33-41-0.60%
Capped Top 4015,058.94-103-0.68%
Capped All Share16,263.25-105-0.64%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
17 Jan 2011SPESCOMSeptember 2010 (Final)
18 Jan 2011NET1UEPSDecember 2010 (Interim)
18 Jan 2011NET1UEPSPDecember 2010 (Interim)
18 Jan 2011NET1UEPSPPDecember 2010 (Interim)
20 Jan 2011FOORDDecember 2010 (Final)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
DIALOGUE11-01-1311-02-1811-02-28R 0.1238
REUNERT5.511-01-0511-01-2111-01-31R 0.0550
SBRJSEP1110-12-1511-03-0411-03-15R 1.4100
NAMPAK 6.510-12-0911-01-2111-01-31R 0.0650
NAMPAK 6%P10-12-0911-01-2111-01-31R 0.0600
Ex Div**
Share NameDec-DateLDTPay-DateAmount
ASTRAL10-11-1511-01-1411-01-24R 4.7000
REUNERT10-11-1711-01-1411-01-24R 2.2000
LEWIS10-11-0811-01-1411-01-24R 1.5600
NETCARE10-11-1511-01-1411-01-24R 0.2750
MERCHANT10-12-1711-01-1411-01-24R 0.1100

Upcoming AGMs**
CodeCompany NameDateStatus
POYPoynting Holdings Ltd19/01/2011Confirmed
CMLCoronation Fund Managers Ltd20/01/2011Confirmed
CMLPCoronation Fund Managers Ltd20/01/2011Confirmed
NTCPNetcare Ltd21/01/2011Confirmed
EFFEfficient Financial Holdings Ltd21/01/2011Confirmed

Stock Exchange News Service
19/01/201117:49 Great Basin - Great Basin Provides Q4 2010 Production Update
19/01/201117:47OML - Old Mutual plc - FORM 8.3
19/01/201117:03 Santam Limited - Director dealing in securities
19/01/201116:56 Further gambling board approval received in the proposed merger of Gold
19/01/201116:49 Pinnacle Point Group Limited - Notice of general meeting
19/01/201116:47 Randgold & Exploration Company Limited - Capital distribution of R&E`s
19/01/201115:25 Capitec Bank Holdings Limited - Dealing in securities by an associate of a
19/01/201115:13 Redefine Properties International Limited - Results of Annual General
19/01/201115:06 Country Bird Holdings Limited - Trading Statement
19/01/201114:35SIM/VIL - Simmers/Village - Renewal of cautionary announcement
19/01/201114:29 Poynting Holdings Limited - Results of Annual General Meeting and General
19/01/201113:59STXNND - Nedbank Limited - Other income announcement in relation to the STX40
19/01/201113:58STXNND - Nedbank Limited - Dividend announcement in relation to The STX40 Share
19/01/201113:57STXNIG - Nedbank Limited - Other Income Announcement in relation to the STX40
19/01/201113:56STXNIG - Nedbank Limited - Dividend announcement in relation to the STX40 share
19/01/201113:28SCIB - Standard Bank Warrants - Notice of rollover of Standard Bank share
19/01/201113:08SAL - Sallies Limited - Facility Agreement and Renewal of Cautionary
19/01/201112:42STXIDE - Investec Warrants - Distribution announcement on Satrix 40 enhanced
19/01/201111:45 Metorex Limited - Production update - six months ended 31 December 2010
19/01/201111:30 SABMiller Plc - Notification of transactions of directors, persons
19/01/201111:17 Village Main Reef Gold Mining Company (1934) Limited - Village`s drilling
19/01/201111:15 Famous Brands Limited - Dealings in Securities
19/01/201111:00 The Foschini Group Ltd - Director Dealing in Securities
19/01/201110:14SCIB : TOPSBT - The Standard Bank Of South Africa Limited - Issue of stock
19/01/201109:41 Avusa Limited - Change to the board of directors
19/01/201109:00ARI/AMS - African Rainbow Minerals Limited/ Anglo Platinum Limited - Joint
19/01/201108:43 Securedata Holdings Limited - Dealings in securities by a director
19/01/201108:30 Bonatla Property Holdings Limited - Acquisition of Madeline Street
19/01/201108:03STXRAF - Satrix RAFI 40 Portfolio - Partial delisting of securities
19/01/201108:02STXSWX - SATRIX Swix Top 40 Portfolio - Partial delisting of securities
19/01/201108:01 ArcelorMittal South Africa - Arcelormittal South Africa Bee Transaction
19/01/201108:01STXDIV - SATRIX Dividend Plus Portfolio - Listing of additional securities
19/01/201108:00 ArcelorMittal South Africa Limited - Further cautionary announcement
19/01/201108:00STXFIN - SATRIX FINI PORTFOLIO - Partial delisting of securities
19/01/201107:54 The Spar Group Limited - Exercise of options and sale of shares
19/01/201107:17INVS - Investec Bank Limited - Announcement to warrant holders of their new
19/01/201107:15 Anglo American plc - Treasury Shares - Transfers
19/01/201107:14INVS - Investec Bank Limited - Announcement to warrant holders of their new
19/01/201107:11STXFIN - SATRIX FINI PORTFOLIO - Distribution Finalisation Announcement -
19/01/201107:10STXSWX - SATRIX SWIX TOP 40 PORTFOLIO - Distribution Finalisation Announcement
19/01/201107:09STXRES - Satrix Resi Portfolio - Distribution finalisaton announcement - quarter
19/01/201107:08STXRAF - Satrix Rafi 40 - Distribution and Re-Investment Announcement - 31
19/01/201107:07STXIND - Satrix Indi Portfolio - Distribution finalisation announcement -
19/01/201107:06STXDIV - Satrix Dividend Plus Portfolio - Distribution Finalisation Announcement
19/01/201107:05 BHP Billiton Plc - Transaction in shares
19/01/201107:05STX40 - Satrix 40 Portfolio - Distribution Finalisation Announcement - quarter

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