Wat ek op sharechat gesê het..
The US payrolls figure was much stronger than even the most optimistic forecasts, making it almost certain that the Fed will embark on increasing the Fed funds rate around mid year, maybe later but certainly in 2015 rather than 2016.
The pressure to follow with rates increases by our reserve bank will manifest itself sooner than thought to ameliorate further declines in the Rand.
Bond yields have reacted as soon as the payrolls figure was released, with the R186 long bond yield increasing from ± 7,70/75% to nearly 8%.
This is not good news for stocks, especially REITS with only local properties in their portfolios. They have reacted to the news by dropping around 3% from the previous day's prices. (They are interest rate sensitive, and closely correlated with bond yields).
So, we are in for rough times, especially for the 'SA Inc.' stocks. Rand hedges should fare better. Resources, all priced in US dollars, will also be affected and it remains to be seen whether a 'booming' US economy is enough to offset the downward revision in China's GDP figure to 7% for 2015.
Expecting some repatriation of overseas investments from our market.
