BN Daybreak Tues 24 March - Markets rally, oil falls, gold bull dead; Apple's next CEO; Helen Zille on Joburg's Collapse

Welcome to BizNews Daybreak with Alec Hogg. In today's episode, we cover the overnight market shifts following a de-escalation in Middle East tensions and dive into the most pressing stories shaping the global and local landscape.In this episode, we unpack:Global Markets: US stocks rally and oil prices decline as President Trump postpones strikes against Iran's energy infrastructure. Meanwhile, gold's historic bull run looks to be over.Tech Leadership: Apple appears to have a new CEO-elect. We look at John Ternus, the 50-year-old hardware genius poised to eventually succeed Tim Cook.Johannesburg's Collapse: Helen Zille delivers a stark warning on Joburg's crumbling infrastructure, revealing that a staggering R300 billion is needed to fix a system crippled by soaring operational costs and political chaos.Nuclear Secrets: Following a 60 Minutes investigation into an attempted heist of South Africa's highly-guarded enriched uranium at Pelindaba, energy expert Dr. Kelvin Kemm provides insight into the stockpile's extreme security..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.00:00:31:10 - 00:00:52:49 Gold was the most expensive ever versus the Bloomberg Commodity Index at the end of February, and the highest in almost 50 years versus the 60-month moving average. It bought the rumour, sold the fact, and now it's just way too expensive. Same in silver. It's going to languish. Thank you very much. There's been a great bull market and it's done. 00:00:52:54 - 00:01:12:46 We'll have more on that story into the future. Is gold done? Certainly looks like it. Big moves in the markets overnight. Lots more coming up. You're tuned in to Daybreak; I'm Alec Hogg and it's Tuesday, March the 24th. 00:01:12:51 - 00:01:34:12 We're cutting through the noise this morning to bring you exactly what you need to know. And I can tell you there's a lot going on at the moment. Good news for a change. I filled up with petrol yesterday and was happy to be able to get the 50l that was available. That's all that you could get at our local service station. 00:01:34:17 - 00:02:06:27 It does appear, though, that there is relief on the horizon. Let's kick off with our partners at Bloomberg News now. US stocks rallied and oil declined Monday after President Trump said the US will postpone strikes against Iran's energy infrastructure after productive conversations with the country, with Iran. We've been negotiating for a long time, and this time they mean business; and it's only because of the great job that our military did is the reason they mean business. 00:02:06:27 - 00:02:31:37 They want to settle, and we're going to get it done now. Reaction to President Trump pulling back on his threat to go after Iranian infrastructure from Aaron David Miller, senior fellow at the Carnegie Endowment for International Peace. I think what you heard from the President this morning that sent oil prices plummeting and the markets rising was an effort to basically find a way out of the ultimatum. 00:02:31:37 - 00:02:52:43 He had issued that within 48 hours, if the Iranians didn't open the Straits, he was going to attack Iranian infrastructure. I think he had to find a way to back down from that. He did back down. I think the Gulf states were pushing hard on him to back down. Aaron David Miller, senior fellow at the Carnegie Endowment for International Peace. 00:02:52:48 - 00:03:19:03 Saudi Arabia and the United Arab Emirates have taken steps toward joining the Iran war. That's according to the Wall Street Journal, potentially signalling an escalation of the fighting. Saudi Arabia agreed to give the US military access to King Fahd airbase; that, according to the Journal, citing sources. It's an apparent reversal after saying its bases could not be used to attack its longtime rival. 00:03:19:08 - 00:03:48:36 The European Union and Australia have agreed to a free trade deal with all Australian industrial exports to the European Union becoming tariff-free. Here's President of the European Commission, Ursula von der Leyen. Today we are telling an important story to a world that is deeply changing—a world where great powers are using tariffs as leverage and supply chains as vulnerabilities to be exploited in our story. 00:03:48:41 - 00:04:19:43 Open rules-based trade delivers positive-sum outcomes. Trust matters more than transactions. The two sides also agreed to a security and defence partnership to facilitate better cooperation on crisis management and security challenges. President Trump's energy chief, Chris Wright, is downplaying the impact that the US-Israeli war on Iran is having on energy markets, saying prices have not risen enough to trigger meaningful demand destruction. 00:04:19:49 - 00:04:50:01 Markets do what markets do. Prices went up to send signals to everyone that can produce more. Please produce more. Prices have not risen high enough yet to drive meaningful demand destruction. But Americans and energy entrepreneurs around the world are ingenious, so things are being done. We've done some pragmatic solutions to take floating barrels that are waiting to unload in China and help them move into ports in other nations in Asia to go into refineries. 00:04:50:02 - 00:05:15:27 Energy Secretary Chris Wright speaking at the Ceraweek conference in Houston. Stocks rallied as a possible de-escalation in the Middle East conflict led to oil falling and stocks rising. Scott Schnipper is chief strategist at Interactive Brokers. The market is getting what it wants, and what it wanted was some sort of reversal. You know, basically almost "you got us into this, you get us out of this". 00:05:15:28 - 00:05:48:45 The Dow up 631 points, up 1.4%. S&P up 74, up 1.1%. Nasdaq was also up by 1.4%. And a great day for the business portfolio. Palantir 6.75% jump. Tesla 3.5%. ASML 4%. Those are all "risk-on" kind of stocks with high betas, as the asset management guys talk. That means that they move more when there is volatility in markets. 00:05:48:59 - 00:06:12:21 Apple up 1.5%. We'll have more on that story coming a little later, or rather something quite big happening at Apple. The unveiling potentially of the new CEO; certainly it is in the media anyway. The rand has improved to better than 17 against the U.S. dollar. Gold was down, as we heard. And we'll have a little bit more about that in a moment. 00:06:12:23 - 00:06:33:48 Bitcoin, however, was up by 3.5%. What's really interesting is what we're seeing. Donald Trump says "I've got a deal with the Iranians". The Iranians say "no talks; we haven't had any talks". Now, not every good media outlet is shouting about the Iranian side of the story, but the markets are telling you "hang on". There must be something going on here if the oil prices are down so sharply. 00:06:33:48 - 00:07:03:18 The gold price is down. And indeed, stock markets are up. So maybe things get lost in war. But let's get into that really big story now. The big movers: Paul Sweeney and Mike McGlone, who is Bloomberg Intelligence's senior commodity strategist, had a chat about this on Bloomberg last night. And I think what they had to say is well worth repeating. 00:07:03:19 - 00:07:04:17 Here's a clip. 00:07:04:22 - 00:07:28:09 There is a key point this morning in our morning meeting. Chris Kayes, equity strategist, pointed out one thing that's happening. S&P 500 dropped below its 200-day moving average. But volatility is still too low. So what I think is, once we have volatility coming from the energy market and the gold market ticking off the stock market, that's part of the pressure to make all these prices go lower and potentially have crude oil go back to the level I've been looking for forever, which is $40 a barrel. 00:07:28:09 - 00:07:52:58 That's been the bottom three times since 2008. So, Mike, there are reports that there has been, as a result of the war and attacks by Israel and Iran, some damage to some of the infrastructure in the Gulf region here. Does that argue for maybe a little bit higher than the normal levels, given there might be a supply constraint for a number of years? 00:07:53:03 - 00:08:15:35 Paul, that's part of that global recession that's really hurting the rest of the world. The U. is a net exporter of crude oil, natural gas, corn, soybeans, and wheat. And the key theme there is probably natural gas for the rest of the world, most notably Europe. That's a problem. A lot of that Qatar natural gas being cut out might take years to bring back on, but in the US, that means a growing glut we'll have to export. 00:08:15:35 - 00:08:36:47 So that's why it's really significant. But this to me is part of that trigger for that global recession that we are already heading towards, potentially hard, because they are fighting tariffs. So now it's about as long as the US can repress the ability for Iran to have offensive capabilities to close the strait—which we're kind of getting there, gold's already figured that out—then this is probably a peak we're going to see for years in crude oil this year. 00:08:36:47 - 00:08:57:51 I'm glad you bring up gold. I wanted to go there next because we've seen gold pare losses. It's now down only 2.1%, but it's still a long way off from the peaks that it made at the start of this year when it hit a closing high of $5,354. Has that bull run ended? I mean, is that the top here? We want to know who to blame. 00:08:57:51 - 00:09:15:53 I think that bull run is over. It's very similar to 1980 and the peak in 2011. As far as the high velocity, gold was the most expensive ever versus the Bloomberg Commodity Index at the end of February—the highest in almost 50 years versus the 60-month moving average. So there's a tremendous front-runner indicator for what's happened. 00:09:15:58 - 00:09:37:59 It bought the rumour, now it's selling the fact, and now it's just way too expensive. Same in silver. And typically when you put in highs like this, you do so with this kind of velocity, they last for years. So I think it's going to languish. Thank you very much; it's been a great bull market, it's done. I like what Mike said because it comes completely aligned with what Peter Major has been telling us for some time now. 00:09:37:59 - 00:10:01:15 Peter keeps these long-term graphs—really, gold relative to pretty much anything you can imagine. And he said they were off the charts, virtually off the charts, the recent gold prices. And he was predicting a significant fall in the price. What Mike McGlone was saying in that little clip is that gold is a perfect front-runner. It tells you that trouble is going to happen. 00:10:01:20 - 00:10:28:43 And then when the trouble happens, well, it reassesses and sells on fact—buys on rumour, sells on fact. And don't we see that too often? Interesting point as well about the oil price. If Trump gets it right, and the markets are currently starting to bet that he might be doing so—you will remember from the business conference last week, our most astute asset manager here in South Africa, certainly the one who wins all the awards. 00:10:28:43 - 00:10:52:25 And he's been doing the best performance: Cy Jacobs from 36ONE. He reckons that the market was expecting or overestimating this, and he was taking a big bet. And he told us publicly that the war would be over sooner rather than later, and that the impact was not going to be as bad as had been anticipated. 00:10:52:40 - 00:11:13:13 Well, right now, this morning, Cy Jacobs seems to be the one who's winning. And if you believe that, and if you believe what Mike McGlone says at Bloomberg—and he's pretty strong on that view—you've got to be looking at Sasol at 208 rand and saying, maybe it's time to be taking my profit. Sasol was down by 2% yesterday. 00:11:13:13 - 00:11:44:48 It's had an incredible run in the last few weeks. Over this period when you had the improvement coming right on the ground, it went from 120 rand to more than 200 rand since late February. All done because of what's going on in Iran. So what the Americans are telling us now is that Iran is pretty much over, as far as the impact on the global markets is concerned. We've got a deal with the Iranians; all is well. 00:11:44:50 - 00:12:04:53 Oil will come back to normal, in fact, could even improve into the future. What the scaremongers are saying is that's not the case. In fact, they're believing the propaganda, perhaps, that's being put out by the Iranian regime. You've got to be on the inside track on this one. But you've got to know as well that Trump moves fast. 00:12:04:58 - 00:12:35:22 There's a big meeting in Houston, which started yesterday, and that was a meeting of all the oil players in the world and the US administration's top guys on the energy side. Here is the FT's James Smyth on what he was anticipating happened. And as we can see from the way that the markets have moved, well, it looks like Trump moves fast. 00:12:35:26 - 00:13:08:00 So we're going to see the ADNOC boss Sultan Al Jaber. We've got the Saudi Aramco boss Amin Nasser. And I think they really want to persuade the US officials that are present at this conference to try and de-escalate this crisis, prevent more attacks on their oil and gas infrastructure. I think we'll see the US officials—Chris Wright, the US Energy Secretary; Doug Burgum, the Interior Secretary—they'll come to CERAWeek and they'll probably be urging US producers to drill more to boost supply in a market which is really constrained at the minute. 00:13:08:05 - 00:13:34:06 Their goal is to drive down oil prices and the price of petrol in the US before the midterm elections in November. And then finally, maybe the US oil and LNG companies, which don't have operations in the Middle East—well, they'll be presenting themselves to customers here as the safe, reliable partners. And I'd expect a lot of Japanese and Asian buyers to flock to this conference to see what type of spare capacity is available in the United States. 00:13:34:11 - 00:13:56:11 It's fascinating because Trump's big thing was energy dominance. And then we've got this huge crisis in the Middle East, which to a certain extent has shown that the US can be insulated a bit from a fossil fuel crisis because it is the largest producer of oil and gas in the world, but it is still affected quite significantly by this crisis. 00:13:56:16 - 00:14:25:41 And then on the other side, you've got China, which is still reliant on fossil fuel imports, but it has stockpiled more than a billion barrels of oil over the last 18 months. It's also suspended fuel exports from the country to ensure it doesn't run dry. But perhaps even more importantly, China has really been pursuing this electrification agenda. And it really shows the divergence between the US, which has pursued this fossil fuel energy dominance agenda, whereas China has very much tried to diversify and push into electrification. 00:14:30:32 - 00:14:56:30 Good news from Southern Africa. Business partner DK Hotel Group showcases world-class hospitality across the region. We spotlight more than 100 carefully selected lodges supporting tourism, local communities, and conservation here in Hermanus. Whale watching and coastal charm await—your home for the BizNews conference 2026. 00:14:56:34 - 00:15:27:49 Interesting insights there from James Smyth, who is the Financial Times' US energy editor. Well, still in the US, because it is one of the biggest companies in the world: Apple. Apple appears to have a new CEO, or at least a new CEO-elect. Let's pick up with our partners at Bloomberg; Mark Gurman talking about a fellow by the name of John Ternus. 00:15:27:50 - 00:15:46:26 John Ternus: it's not a name that a lot of people outside of, like, the immediate Apple ecosystem were super familiar with a couple of years ago. But he's been at Apple for 25 years. Why is he in the position, in your view, to be the heir apparent to Tim Cook? There are a few main reasons. One—and this is an interesting one—he's 50 years old, which makes him 15 years younger than Tim Cook and at least ten years younger than the rest of Apple's executive team—people who would be in position to take the CEO role. 00:15:46:35 - 00:16:08:30 Tim Cook is not going anywhere imminently. I still think it's going to be at least another year to go before he's no longer CEO; maybe 2 to 5 years, who knows at this point? I mean, everything in his world is Apple, so it's a hard position to move on from. And that means that the rest of the executives who could take over are going to be even older. 00:16:08:34 - 00:16:27:18 And so you need someone in the role who could take over and be in that position for 10 to 20 years. And that really leaves you only with John Ternus. Aside from that, he's the only person on the executive team who has successfully launched hardware-software integrated products. He is essentially in charge of their products, which generate 80% of revenue for the company. 00:16:27:23 - 00:16:51:36 He's known for his political acumen. He's known for empowering leaders under him at Apple. He's known for getting into the weeds on the technical side. He would be a different type of CEO for Apple. Steve Jobs was an innovator, a designer, a product genius—really a visionary. Tim Cook was a visionary when it came to operations and sales and finances. 00:16:51:41 - 00:17:22:34 And Ternus, in his own right, is a maestro of engineering: solving hard problems, bringing devices to market, drumming up new products. So that's going to be a different type of CEO. But I still think it would be a continuity pick in the sense that he's worked under Tim for a very long time. Well north of a decade he's been a Senior VP at Apple, for about five years at this point. 00:17:22:39 - 00:17:52:46 And he's someone Apple has been pushing to the forefront in its marketing, in its keynotes, meetings with government regulators, meetings with press locally in different jurisdictions around the world, different Apple campuses and in offices globally. So this is someone who's at the forefront of the CEO race at Apple right now. It's a point that we have to consider: Apple is one of the biggest companies in the world. 00:17:52:51 - 00:18:27:22 It was worth $3.7 trillion. That is nine times bigger than South Africa's annual gross domestic product. So you take everything spent in South Africa in a year—put it all together, every cent, everything you can spend down at the local café or at the bookstore. Put it all together: your salary, the imports, the wine—and you multiply that by nine times. That's what Apple is worth. 00:18:27:27 - 00:19:04:16 Getting some kind of perspective on this, aren't you? And I guess where we stand in the world. But it is interesting in that the founder, Steve Jobs, had—well, he was followed by—we'll just say when it went off the rails, we really have to look at Apple when Steve Jobs came back into the company after that; Tim Cook took over from him. And John Ternus would be only the third CEO in something like 30 years. 00:19:04:21 - 00:19:47:27 Quite a big story that, when Bloomberg is hitting the news way before anybody else. Back onto the local front now, and at the news conference last week, Helen Zille spoke about Rome and she gave some suggestions on what the collapse of Rome—which was the Eternal City—held for Johannesburg, where she's hoping to become the next mayor. Jo'burg's fault lines bear an uncanny resemblance to those which toppled Rome. 00:19:47:32 - 00:20:11:13 We all know that Jo'burg is in a dire state, but I really underestimated just how bad it is. We can all see what is wrong by driving through it, but it's even more alarming when you discover why it is wrong and that it can still get worse. Jo'burg's infrastructure is on the brink of collapse, apart from which some of the stuff has already collapsed. 00:20:11:17 - 00:20:46:33 Of course, an estimated 300 billion rand is needed to fix it. And the current government—that unwieldy coalition of chaos—has given up trying. Since 2010, Jo'burg has tripled its operational expenditure and staff costs have ballooned by 84%, even after adjusting for inflation. In the same period, capital expenditure has halved as a percentage of the budget. 00:20:46:38 - 00:21:28:58 The capital budget is now just 8.7 billion rand, which is 0.5% of the value of its capital assets—far below the recommended 8%. Instead, the money that city entities receive from residents' water and electricity payments gets siphoned off; some lands in the city's general account and is used to pay escalating operating costs, including the bribes and kickbacks which have now become an essential part of the ANC's business model. 00:21:29:03 - 00:22:04:59 In contrast, the City of Cape Town spends more on infrastructure than all three Gauteng metros put together. Its infrastructure budget is more than 60% higher than Johannesburg's. And in fact, its infrastructure budget goes on planning and preparing for the future, not even fixing what went wrong in the past because they've kept up with it every year. While Cape Town invests in the future, Jo'burg mayors focus on how to survive the next motion of no confidence as the smaller parties switch allegiance. 00:22:05:04 - 00:22:34:47 When your attention is totally focused on putting together a majority vote for the next council meeting, the strategy will be to buy votes rather than invest in roads. After Jo'burg reported more than 57,000 pipe bursts last year, it repairs just 17km of pipes annually. Cape Town does 140km, and Jo'burg fixes less than 10% of what is urgently required. 00:22:34:52 - 00:22:57:40 Meanwhile, the water system is leaking itself to death. Almost half of Jo'burg's water supply is lost to physical leaks, theft, and billing errors. And that is when dams are full, because Jo'burg just cannot get its water from the full dams to its people. It's been quite a joining-the-dots story today, hasn't it? This episode. And here is another joining-the-dots. 00:22:57:51 - 00:23:23:58 You know, we sit back often—many people I know—and they say "I'm not interested in politics". Somebody else can do the politics. Well, you better start getting interested in politics. If you see the impact of this—Helen Zille is not pulling these numbers out of the air. This is fact. Cape Town, which is smaller than Johannesburg, has a CapEx budget 60% bigger than Johannesburg's; in fact, Cape Town's CapEx budget investment in the future is bigger than all of the metros, she tells us. 00:23:24:02 - 00:23:54:26 You've got to say, hang on a minute, who's running these places, and what am I doing to make sure that I have the right people doing so? Helen Zille is a front-runner, from the chairman of the board of the Social Research Foundation and the man behind The Common Sense, a new website that focuses on politics. He says that Helen Zille moving into Johannesburg to go as mayor was a masterstroke for the DA, which will change the politics in South Africa permanently. 00:23:54:31 - 00:24:29:14 Well, let's see. But just if you don't understand how it works, it's quite simple. You get money coming in and—you know, Enoch Godongwana said this as well, the Finance Minister—he said what drives him crazy is that the money that is given to Johannesburg for capital expenditure—in other words, the stuff from the central government to fix the problems and to prepare for the future—that money goes into a big pot. It doesn't get allocated individually to projects. 00:24:29:19 - 00:24:59:00 They're changing it, but that's the way it's been and it's like a big honeypot. And that honeypot has been used by those governing the city—the ANC—to pay its friends and those political influencers who push the cream sodas and Johnnie Walker Blue in our faces. Well, it's our fault; we can change it. There's a video doing the rounds at the moment coming back from 60 Minutes. 00:24:59:05 - 00:25:23:53 60 Minutes is one of the top programs in the United States. What it used to be—now there's lots of debate on whether or not under the new Bill Owens head it still is the flagship of the CBS network. But anyway, CBS 60 Minutes did a focus on an attempted heist of South Africa's enriched uranium. Now we've got a lot of it; it comes back from the time of apartheid. 00:25:23:53 - 00:25:51:07 And this enriched uranium is the first step—and very easy if you get your hands on the enriched uranium—to make an atom bomb, a nuclear bomb. And the video that is surfacing is suggesting, because there's so much conflict in the world at the moment, the price of that enriched uranium has gone up some more. That 2007 investigation by 60 Minutes suggested that the crooks nearly got away with it. 00:25:51:11 - 00:26:20:32 They arrived there with armed guards; they happened to hit a guy who was there with his girlfriend. They shouldn't have been there. These were real toughies who beat off a couple of them and actually got shot for his troubles. But anyway, it's a wonderful story—adventure story. But the real issue that we've got to consider now: how safe is that enriched uranium? My colleague Chris asked Dr Kelvin Kemm, who is one of the energy gurus here in South Africa, and he gave us some heartening insights. 00:26:50:43 - 00:27:13:33 Dr Kemm, with everything that we are hearing currently about police and political capture, how safe is South Africa's enriched uranium? "It's very safe. It's in a secret place. Only a couple of people know exactly where it is. In fact, very few people know it even exists. But the international community knows—you know, the IAEA's of the world know". 00:27:13:33 - 00:27:41:38 So what I'm saying is that's not going to be news to any of them. And it's within a large 2,000-hectare site which has gorgeous security fences around it. It's also multiple—about 150 buildings on the site—and it's in a building that's secure. It's also not that big in terms of volume. It's a lot in terms of enriched uranium, but it's not as if it's truckloads or something like that. 00:27:41:43 - 00:28:05:30 Dr Kemm, if South Africa decided to secretly gift some enriched uranium to another country, who would have to authorise its removal from the facility? "There's the Pelindaba Treaty, which is signed by African countries. It's like all the African countries, maybe two minor ones haven't, but my memory says that the Pelindaba Treaty was the first one in the world where an entire area would declare itself a nuclear-weapons-free zone". 00:28:05:30 - 00:28:35:55 So that came into effect quite a few years ago. Unless we really are out of the treaty, since we were declared a free zone. We also have agreements with the International Atomic Energy Agency, UN, and others that we will not pursue any weapons of mass destruction in the future, which we haven't done—nuclear is part of it. So in principle, what you ask, it would only be authorised at the highest level of government. 00:28:36:03 - 00:29:07:54 But in fact, the Council is there to stop anybody doing it because if government or private enterprise—anything of that nature comes to the Council, and the Council has to look: 'Is this something that could conceivably be used in a life?' and then if it is, the Council will exam it and if there's any suspicion, it'll be prohibited". But could the Council be bypassed? "I'd find it very difficult to bypass it. Somebody would have to physically go to where the material is and take it, and therefore authorities there would have to open the gates and open the doors and so on and so forth. And they all know that if anything like that happens, they would have to report it to the Council". 00:29:26:10 - 00:29:49:24 And it's already set up to have a number of people that—you know, on the criminal aspect, so to speak—to be able to get to the point where it was taken out without anybody's knowledge, I would like to say that I think that's pretty much impossible. 00:29:49:29 - 00:30:11:40 Well, that wraps up today's edition of the BizNews Daybreak. Thank you for starting your morning with us. For a deeper dive into these stories, market updates, and expert analysis, be sure to head over to biznews.com. And don't forget to subscribe to this podcast wherever you get your audio so you never miss an episode. I'm Alec Hogg, wishing you a profitable and productive Tuesday. 00:30:11:45 - 00:30:22:12 And until tomorrow, cheerio.

BN Daybreak Tues 24 March - Markets rally, oil falls, gold bull dead; Apple's next CEO; Helen Zille on Joburg's Collapse

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