BN Daybreak - Fri 9 Jan: Rio-Glencore Mega-Merger; Burry's market warning; Shapiro on fixing SA

In this edition of BizNews Daybreak for Friday, 9 January 2026, Alec Hogg breaks down the market-moving stories you need to win the day. A massive deal is back on the table as Rio Tinto and Glencore revisit a potential mega-merger. We also feature insights from "The Big Short" legend Michael Burry, who joins author Michael Lewis to warn of an overheated stock market and share a bearish take on high-flyer Palantir. Closer to home, David Shapiro explains why South African companies are stuck in "survival mode" and argues that fixing basic infrastructure matters more than new government white papers..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..Watch here.Listen here.Edited transcript of today's BizNews Daybreak:.The big story of the South African morning is another mega-mining merger with strong South African involvement hitting the headlines. Back in 2024, Glencore—the Swiss-based mining house richly endowed with Johannesburg roots—had an unsuccessful run at buying another global major, Rio Tinto. This morning, the deal is back on, but this time in reverse. Here is our partner at Bloomberg, Clara Farah Marquez.Clara Farah Marquez (Bloomberg): There is a potential deal that would create the world's largest mining company. Glencore is in talks with Rio Tinto Group about a merger. It’s been a big couple of years for deal-making; last year was very busy, and it looks like we’re starting off strong again this year with talks between Rio and Glencore. They were talking back in 2024, but at that point, it was Glencore making the move. This time, it might be the reverse. It is an obvious combination; Rio has been interested in iron ore, and Glencore has better copper assets ready than Rio has.Alec Hogg: Financial markets are pricing in about two rate cuts from the Fed this year. However, Fed Governor Stephen Miran is pencilling in at least six. Miran sees underlying inflation running at an annual rate of 2.3%. That is lower than the current reading of the Fed's preferred measure of inflation, which is 2.8%. Shelter inflation lags significantly, and because average tenant rents have caught up to new tenant rents, Miran thinks it’s appropriate to abstract from that. He believes the American economy could add about a million jobs without adding to price pressures.Turning to the markets, the Rio Tinto share price came under pressure last night, whereas Glencore's was firmer. The S&P 500 was flat, and the Nasdaq was down by about half a per cent on Wall Street. Palantir, which is in the BizNews portfolios, came under pressure, falling 2.5%. We bought Palantir at around $8 a share in the "Shift" portfolio; it’s $176 now, and we’ve been progressively cutting the holdings.Elsewhere, Nvidia was down 2% to $185. Google has overtaken Apple in terms of market cap after a 1% improvement, while Apple went down by half a per cent. Amazon rose 2% last night, and Uber was up 1.5%. The star performer in the US for our portfolios was Teledyne Technologies, up over 3%.On the Johannesburg Stock Exchange yesterday, the star performer was Purple Group, which rose by 4%. HCI saw a 4% bump after selling its 65% stake in the Whale Coast Mall in Hermanus for 600 million Rand. Orion also continued to improve, reaching 33 cents a share.The Michael Burry interviewAlec Hogg: The investing star Michael Burry reckons that further interest rate cuts will simply push an already overheated stock market deeper into "overtime." Burry, who hit public consciousness through The Big Short, gave a rare interview to Michael Lewis. In this segment, Burry gives us pause on Palantir.Michael Lewis: Alex Karp, who runs Palantir, has gone after you for owning puts on his stock. It’s always a bad sign when people start going after the short sellers. I want to understand your trade. Why do you think Palantir goes way down in two years?Michael Burry: My belief is that this is a company with applications that were very expensive to install because you had to hire their consultants just to learn the software. Their government contracts were a majority of revenue, but that has fallen off as they marketed themselves to corporations during the AI build-out.They keep saying they are the only ones, but IBM does basically the same thing and their business is actually bigger than Palantir's. There are five billionaires that came out of Palantir on revenue of only $4 billion. The "billionaires-to-revenue" ratio is greater than one; I've never seen that before. If you deduct the cost of buying back shares to offset dilution from stock-based compensation, they don't actually make anything.The South African context: David ShapiroAlec Hogg: South Africa's favourite stockbroker, David Shapiro, argues that South African companies are no longer thriving, but merely surviving.David Shapiro: The JSE has moved from being a stage for champions to a battleground for fighters. Companies are just fighting for survival—managing without electricity by installing solar, or dealing with no water by putting in tanks. We are adjusting to the circumstances rather than saying, "We’ve got to change this."I run every day, and I find new "dams" in Joburg—big potholes full of rainwater—and we just run around them. You need infrastructure to build an economy. I started to see the institutions deteriorate back in 2007—the law courts, the schools, the streetlights. We don't need new white papers from Pretoria; we just need to fix the roads and make schools safe. If we create that environment, people will start to invest in this economy rather than taking their money out.Alec Hogg: I'm Alec Hogg, thank you for starting your morning with us. Now go and seize the day.

BN Daybreak - Fri 9 Jan: Rio-Glencore Mega-Merger; Burry's market warning; Shapiro on fixing SA

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