The all share index on the JSE reached a new record level at the close on Friday. This, despite tensions around the German investigation against Steinhoff’s alleged inflated financial accounts that had seen the share price tumble 15%on Thursday.
On the other hand, Naspers also reached a milestone by trading above the R3000 and closed Friday afternoon on R3010. Many analysts now feel that the 50% increase in Naspers share price since the beginning of the year was mostly due to its 33% stake in Chinese company Tencent. They feel that the rest of the company did not perform as well and that the share price is overvalued.
Some shareholders also feel that the remuneration paid to top executives is not aligned to the performance of the rest of the business, excluding Tencent.
The announcement of the much lower inflation rate of 4.6% in July, with expectations that the rate will remain lower than 5% for months to come, contributed to retail share prices to have rallied on the back of interest rates that are likely to come down.