By Alec Hogg
Here are today’s global headlines:
- Apple Inc, which at $900bn shades Microsoft as the world’s most valuable company, will today unveil a years-in-the-making strategy to install video and news subscription services as its top priority. CEO Tim Cook is poised to announce that Apple will shift away from a reliance on selling iPhones to developing dominance in services, where revenues have been growing strongly but are still only 15% of the group’s total. The company’s ambition in video is to become an alternative to cable TV, combining original series with shows from other networks in another attempt to reinvent television. Apple is a core holding in the Biznews Exponential share portfolio. Premium members can sign up for Thursday’s webinar where we will update the portfolio’s progress.
- British Prime Minister Theresa May faces another difficult week. She is encountering growing dissatisfaction from her Conservative Party colleagues over the way she has handled Brexit, with her request last week for the EU to postpone the deadline described by some colleagues as a national humiliation. Speculation was rife in the UK’s Sunday newspapers that the party is on the brink of replacing Mrs May with a caretaker prime minister such as David Lidington or Michael Gove, although both have publicly warned against changing the leadership at this delicate point.
- Over the weekend Italy became the first major economy to sign an agreement with China to cooperate on Beijing’s global infrastructure plan, the Belt and Road Initiative. The accord is a diplomatic victory for Chinese president Xi Jinping, whose ambitious plan for an international network of ports, roads, railways and pipelines has faced widespread criticism. US and European diplomats criticised Italy’s move as it will weaken Western cohesion.
- In South Africa, traders are taking bets on two big events coming at the end of the week. On Wednesday and Thursday, the SA Reserve Bank’s Monetary Policy Committee holds its six times a year meeting to determine whether to raise or cut interest rates. The betting right now is overwhelmingly for a no change. And on Friday, ratings agency Moody’s has a date in its calendar to provide an update on the rating of South African debt. Moody’s is the only one of the world’s three major ratings agencies which still has South African debt at investment grade. It is likely that Moody’s will release a research report on Friday, and there is a small chance that it will lower the outlook from neutral to negative. An actual cut in the all-important investment grade rating, however, appears unlikely.
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