Ramaphosa’s Cabinet reshuffle, as anticipated by Dynasty, lacked substance – Bathabile Dlamini and Nomvula Mokyane still have their jobs, and the Cabinet continues to be bloated with redundant, corrupt ministers and deputies.
- The UK has launched a probe into the four big auditing firms, Deloitte, EY, KPMG, and PwC. This was initiated following the collapse of several major companies who were audited by at least one of the big four firms.
- The Dow retreated by 2.2% on Tuesday and is close to 10% off its September peak, to be slightly under water for 2018. Increasing interest rate expectations, the recent reversal of the oil price, the fading effects of US tax cuts and the US-China trade war concerns continue to lead to heightened global volatility. Our research indicates, however, that companies, specifically those in the US, continue to grow their earnings at compelling rates and valuations remain undemanding.
- Carlos Ghosn, the boss of Renault and Nissan, was arrested in Tokyo for alleged financial wrongdoing. Ghosn has been accused of under-reporting his salary by $44million over five years, follow the link for more information. Since then Nissan has removed him as Chairman.
- Vladimir Putin’s “chef” – a man implicated in Robert Mueller’s investigation of Russian interference in the 2016 U.S. elections – is now meddling in Africa. Follow the link for more.
- The EU has raised doubts over the upcoming Brexit summit on Sunday. Although a draft Brexit deal has been agreed upon by the UK and the EU, there are still many contentious issues that need to be ironed out, for instance, the rights of European vessels to fish in British waters, the status of the UK territory of Gibraltar, and future trade in goods.
- Mark Zuckerberg announced this week that he has no plans to step down as CEO of Facebook.
- The South African Reserve Bank raised interest rates by 25bps this week. This decision was made due to the upside risks facing inflation as a result of tighter global financial conditions, a weaker exchange rate and high oil prices since March 2018, as well as higher wage growth. Headline inflation forecasts for 2018 and 2019 were revised lower to 4.7% and 5.5%, from 4.8% and 5.7% before, while the 2020 estimate was unchanged at 5.4%. The growth outlook was revised lower by 0.1ppt to 0.6% for 2018 and is unchanged at 1.8% and 2% for 2019 and 2020.
- Cyril Ramaphosa’s Cabinet reshuffle: Siyabonga Cwele, former Minister of Telecommunications and Postal Services replaces Malusi Gigaba at Home Affairs. Nomvula Mokonyane, previously Minister of Communications, takes the reigns at Environmental Affairs, replacing the late Edna Molewa. Former Deputy Minister of Communications, Stella Ndabeni-Abrahams, is appointed Minister of the merged Communications and Telecommunications and Postal Services Department.
- For analysis regarding the Cabinet reshuffle and the reasons behind Ramaphosa not clearing out all the dead wood, follow this link.
- Imperial’s split has been formalised and Motus has been created. Yesterday, Motus shares were listed on the JSE and joined the market’s Top 100 companies.