China in trouble, is it over? Should we be worried? (#571)

JSE Direct with Simon Brown

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Introduction:

JSE Direct Episode 571 for January 25, hosted by Simon Brown. Simon introduces the idea of transitioning the podcast to a live format using Riverside, allowing viewers to see charts and interact during recordings.

Market Updates:

Richemont*:

• Stock surged 10% on better-than-expected trading update.
• Identified as an opportunity last year when it pulled back to R2,500.
• Trading at R2,653 at the time of the recording.

AVI:

• AVI delivered a strong update, but struggling with I&J.
• AVI focuses on defending margins, willing to lose volumes for profitability.
• Potential sale or listing of INJ discussed.

Woolies*:

• Mixed trading update.
• Struggles in Australia, especially with David Jones, while food segment remains strong.
• Concerns about the performance of the clothing segment.

Clicks:

• Mostly a strong update, struggles in UDP (wholesale drug distribution).
• Selling price inflation averaged 7.5%, higher than the previous period.
• Clicks achieved highest-ever daily sales in late December.

Economic Updates:

• December spending records discussed with BankserveAfrica.
• Expectations for rate announcements from local and European central banks.
• Hawkish tone expected from local governor; questions about Jerome Powell's stance.

Global Market Highlights:

All-Time Highs:

• S&P 500, Nasdaq, Dow Jones hit all-time highs.
• Russell 2000 still 20% off its highs, considered in bear market territory.
• India's stock market surpasses Hong Kong, becoming the world's fourth-largest share market.

China in trouble, is it over? Should we be worried?

• Simon reflects on recent data and developments in China.
• Population decrease and aging population noted.
• Speculation on a potential $278 billion spending spree to support the market.
• Concerns about state-directed capitalism and common prosperity policies.
• Recent crackdowns in gaming, education, and potential implications for healthcare.
• China's focus on national defense and potential impacts on Taiwan.
• China's shift towards a more inward-looking and self-focused path.

Conclusion:

• Speculation on the impact of China's changes on global growth, commodity prices, and investments.
• Simon announces plans to start recording the podcast live, with notifications on social media and newsletters.
• Acknowledgment of the podcast's longevity (571 episodes) and a request for reviews.

Closing:

Simon Brown signs off, encourages reviews, and mentions future live recordings.

Reminds listeners to take care of themselves and others.

* Simon holds ungeared positions.