The S&P500 has virtually completed its seventh “mini-” on Friday the 4th of June 2021, since the of the pandemic in March 2020. It exceeded its previous all-time level of 4232.6, reaching an high of 4233.45. That it would probably go to a new was indicated by its record intra-day high of 4234.12 made on 1st June 2021, immediately after the Memorial Day holiday. Further new record high closes are evidently imminent as international surges back towards “ ”. Consider the :
The strong upward move has gained new momentum from Joe Biden’s proposed $6trillionproposal and is boosted by good quarterly results from the S&P500 . remain low and investment optimism is rife.
The shift towards “risk-on” is impacting on theof as more and more overseas investors, faced with zero or negative real interest rates at home, join the search for on their money. The rand, which, in our opinion, has been for some years, is strengthening rapidly.
On Friday evening (4th June 2021) the rand was pushed to newat R13.4311 to the US dollar. Consider the chart:
In our view the rand is now, perhaps, a littlein the short-term and some sort of correction seems probable. Nonetheless, its strength means that the rising price has been largely offset for South African motorists.
The price ofhas up through at $69 and is now trading at $71.89. This reflects the fact that demand for motor vehicles continues to rise worldwide as the international economic recovery gains momentum. The growing take-up of electric vehicles is not yet sufficient to dampen oil demand significantly. Consider the chart:
It is now apparent that theis in a strong economic which is reflected in rising and . South African economic recoveries have always been “ ” and this recovery will be no different. Despite our various efforts at , we remain primarily an exporter of commodities and we are enjoying a commodity bonanza as everything from and to and rise to new highs.
The affluence which this has created is working its way through the, impacting commodity shares first, of course, but spreading to other , most of which are recovering quickly. This is a time to be fully invested, but to keep a wary eye out for that correction which we predicted in last month’s Confidential Report.
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