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Consumption in China: From commodities to karaoke

27 November 2015 | Economy

There has been great concern regarding the slowdown of growth in China and its impact on commodity demand and, therefore, commodity prices. Crude oil’s price gyrations tend to get the most attention, but China’s share of global oil consumption is about 12%, which is significant but less than that of the United States.1 One could argue that Chinese demand patterns likely have played an even greater part in influencing prices of many other commodities where China holds an even larger share of global consumption. China’s share of global grain consumption was around 22% in 20142 and its share of global metal consumption tripled from 13% in 2000 to 47% in 2014.3 China is a key consumer of aluminum, nickel, copper, zinc, tin and iron ore. Of course, China isn’t only a consumer of raw commodities—its growing middle class has been exerting formidable purchasing power and spawning new domestic industries that are of keen interest to us as investors, including cosmetics, entertainment (cinemas, music) and more.

African private equity is growing fast

25 November 2015 | Equities

While the South African private equity market is relatively mature, east and west African markets are catching up fast. This is according to Bowman Gilfillan’s Head of Private Equity, John Bellew. He said that, in particular, Kenya, Nigeria and Ghana were seeing an increase in private equity deals in their countries, but that other countries were also benefiting from increased transaction flows.

What 2015 means for the future

25 November 2015 | General

• “Greece represents a tiny fraction of the global debt crisis.” • “Japan is living on borrowed time.” • “ISIS is intent on accelerating its campaign of terror.” • “SA equity funds failed to outperform their benchmarks.”

Small caps an exciting hunting ground

25 November 2015 | General

Even though the small cap sector forms the bulk of the JSE in terms of number of shares, it comprises only 3.5% of our stock exchange’s market capitalisation. Top quality companies with exceptional business models reside in the small cap universe, but most established unit trust funds are too large to hold a meaningful stake in a small cap company without breaching unit trust regulations.

quick poll

Question

Do you think short-term insurance broking will survive the AI plus humanoid robotics age?

Answer

Human first always Not a chance Possibly maybe Yes, but reimagined

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