Chinese firms ramp up global investments

Chinese firms are accelerating their foreign investments to an eight-year high, led by sectors like electric vehicles and solar energy. In the first quarter of 2024, they invested $33.5 billion overseas, a 13% increase from last year, aiming to create jobs and stimulate economic growth in host countries rather than increasing exports. Significant moves include Chery Automobile in Thailand and BYD in Brazil. This shift from infrastructure to manufacturing is seen as a strategy to manage trade tensions and navigate tariffs, especially in the United States and Europe. However, these investments are met with scepticism due to geopolitical concerns.

Artificial Intelligence innovator targets 2030 for autonomous vehicles in Japan

Issei Yamamoto, known for his (Artificial Intelligence (AI) developments in Japanese chess, is now focusing on autonomous vehicles, aiming to introduce self-driving cars in Japan by 2030. His startup, Turing Inc., supported by major Japanese investors, raised ¥3 billion to advance Japan’s role in electric and autonomous vehicle technology. Turing plans to showcase a self-driving car next year and mass-produce AI chips by 2028, using advanced machine learning models over traditional AI methods. Despite facing competition from automotive giants like Toyota and Honda, Yamamoto is confident about Turing’s impact on the industry.

Mobile game launch boosts Naspers and Prosus shares amid Tencent rally

The recent surge in Naspers and Prosus shares is largely driven by the performance of Tencent, their major investment, following its announcement of a new mobile game, “Dungeon and Fighter.” This news significantly increased Tencent’s market value, positively affecting Naspers and Prosus. The rally reflects expectations that the new game will boost Tencent’s profits and indicates a possible easing of China’s strict gaming regulations. Despite these gains, Naspers continues to trade at a significant discount to its net asset value, pointing to persistent market challenges.

Market Moves

On Monday, the South African rand showed resilience, positioned at R18.75 against the dollar, spurred by positive market sentiment. This follows after a recent Ipsos poll suggested sustained support for the African National Congress, despite a decrease in its popularity. On the local front, the Top 40 index and the broader all-share index each rose by approximately 0.5%, while South Africa’s benchmark 2030 government bond also strengthened, with its yield decreasing to 10.75%.

Looking at the week ahead

On Tuesday, South Africa will report private sector credit, while the Euro Zone will release its Producer Price Index (PPI) and Consumer Price Index (CPI). Additionally, South Africa will disclose its trade balance. Moving to Wednesday, the United States will announce its Job Openings and Labor Turnover Survey (JOLTs) job openings, along with the Federal Reserve’s rate decision. Thursday will see India reporting its Manufacturing Purchasing Managers’ Index (PMI), South Africa disclosing its Manufacturing PMI, and the United States revealing its exports and imports data. Finally, on Friday, India will report bank loan and deposit growth, while the United States will release its unemployment rate.

April 30th

Source: FundFocus. Data as at 26 April 2024. Past performance is not a reliable guide to future performance.
For illustrative purposes only and not indicative of any investment.