Equities | Monetary Policy & Inflation | Politics & Geopolitics | US
Charts of the Week – Railroad and Electric Vehicle Woes
- By Matthew Tibble
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- 2 mins
Summary
- US labour market issues persist, as is evident at railroad companies.
- ETFs for electric vehicles make little sense, according to John.
- South Africa’s political troubles are impacting the rand and stocks.
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Summary
- US labour market issues persist, as is evident at railroad companies.
- ETFs for electric vehicles make little sense, according to John.
- South Africa’s political troubles are impacting the rand and stocks.
US Employers Still Struggling to Fill Vacancies
Dominique recently explained how staffing issues at US railroad companies were an aliquot of the issues permeating the broader economy. These include increased market power, unwillingness or inability to offer high enough pay to resolve staffing, and capacity shortages. The problems are evident in, for example, the collapse in the ratio of actual hires to job openings in the JOLTS data (Chart 1).
Chart 1: US Labour Market Tightens Further
Any Point in Electric Vehicle ETFs?
As John explained, ETFs for electric vehicles make little sense. They mostly hold large-cap stocks and generally offer market index returns – with high fees and some volatility thrown in (Chart 2). Those interested in the EV sector should review holdings of EV ETFs and select the potential nuggets that might post outsized gains in the coming years.
Chart 2: EV ETFs Track the Broader Market
Rand Struggles Amid Ramaphosa Controversy
Expectations over the ‘imminent’ resignation of South African President Cyril Ramaphosa on Thursday left the rand down by as much as 5% intraday. The selloff was triggered by the publication of an independent review into a robbery at the president’s game farm, which concluded that Ramaphosa may have violated the constitution. Under Ramaphosa, stocks have underperformed, and the rand has weakened (Charts 3 and 4). A speedy resolution to the turmoil looks unlikely.
Chart 3: JSE Underperforms Under Ramaphosa Chart 4: So Does the Rand