GTC Trendline – March 2015
See-saw Margery “Dow”
The first quarter of 2015 saw global markets reach record highs before falling off towards the end of March. The MSCI World posted 1.8% (USD) over the quarter, with strong contributions coming from Japan, Europe and the U.S while the UK declined by 0.95%. Quantitative easing in the Eurozone and China initially helped drive up equity prices. Crude oil prices, having experienced dramatic falls in the previous quarter, also stabilised bringing some calm to what had been a highly volatile situation. Market volatility was a key feature of markets over the period as economic news continued to blow hot and cold resulting in risk-on, risk-off being the order of the day.
FIAT LUX – Let there be light…
South African markets rose over the quarter on the back of the global risk on environment with the ALSI posting 5.8% (ZAR) led higher by Financials (13.7%) and Industrials (5.6%) with Resources down 0.25%. Within the fixed income market, the ALBI rose 3.0% with yields coming in on the long end of the curve whilst inflation linked counterparts were also marginally up (0.2%). The Rand declined 5.6% over the quarter.
The pending twin peaks regime
It is truly remarkable that the fallout from the 2008 Global financial crises continues to be felt around the world, including South Africa. The current regulatory landscape locally is that the financial services sector (excluding banks) is regulated by the Financial Sector Regulation Authority (hereinafter referred to as the FSCA ). It’s regulation of this sector has left gaps which have been exploited by the unscrupulous to the detriment of the public. Why should banks be excluded from the general net in the first instance, one might ask?
