Market Update

Global: Viva Italia! US equities continued to advance in May, with earnings and economic data providing a buffer against the machinations of President Trump and his continued trade tariff rhetoric. The Trump administration confirmed it would implement punitive trade tariffs on steel and aluminium imports from Canada, Mexico and the EU,and also withdrew from the Iranian nuclear accord.The threat of a potential disruption to international trade did rattle the markets, but the robustness of economic growth data negated the overall impact. Read the full article Domestic: A new dawn? In line with the majority of global equity markets the FTSE/JSE All Share Index experienced a torrid May,declining -3.5% led by sharp falls in retail and financial shares. Disappointing corporate earnings reports also helped create a negative market attitude. The FTSE/JSE Financials Index declined -6.3% largely as a result of Rand currency... Read More

Global: Trumpy tweets! US economic data continued to display solid growth with GDP for Q1 confirmed at 2.3%. This was slower  than growth in Q4 but was ahead of expectations. Inflation also ticked up with the target range of 2% now in  sight. In spite of this encouraging data, equity market performance remained pedestrian because overshadowing the  positive news was the proposal by President Trump that the US impose penalising trade sanctions against China. Read the full article Domestic: Light at the end of the tunnel? A plethora of encouraging economic data resulted in the FTSE/JSE All-Share delivering a solid performance for April – returning 5.4% for the month which was to a large extent driven by a resurgence in resources counters.The resources index received an additional boost from a rise in gold stocks, on the back of a renewed... Read More

Global: Trumpy tweets! US economic data continued to display solid growth with GDP for Q1 confirmed at 2.3%. This was slower than growth in Q4 but was ahead of expectations. Inflation also ticked up with the target range of 2% now in sight. In spite of this encouraging data, equity market performance remained pedestrian because overshadowing the positive news was the proposal by President Trump that the US impose penalising trade sanctions against China. Read the full article Domestic: A change to the old guard. A plethora of encouraging economic data resulted in the FTSE/JSE All-Share delivering a solid performance for April – returning 5.4% for the month which was to a large extent driven by a resurgence in resources counters. The resources index received an additional boost from arise in gold stocks, on the back of a renewed escalation... Read More

Global: Wage inflation the culprit? The US equity markets suffered a sharp decline early in February, driven initially by wage inflation data which suggested that the Federal Reserve would be inclined to increase interest rates at a faster rate than was initially expected. This concern was further heightened by newly elected Federal Reserve Chairman Jerome Powell suggesting to the US Congress that there was scope to raise interest rates four times this year. Read the full article Domestic: A change to the old guard. Politics, the Budget and the downturn in global equity markets took centre stage during February. Cyril Ramaphosa was sworn in as the new president of South Africa following the resignation of Jacob Zuma. The budget speech held no great surprises given the current state of the economy, the main feature being a rise of 1% in... Read More

Global: Wage inflation the culprit? The US equity markets suffered a sharp decline early in February, driven initially by wage inflation data which suggested that the Federal Reserve would be inclined to increase interest rates at a faster rate than was initially expected. This concern was further heightened by newly elected Federal Reserve Chairman Jerome Powell suggesting to the US Congress that there was scope to raise interest rates four times this year. Read the full article Domestic: A change to the old guard. Politics, the Budget and the downturn in global equity markets took centre stage during February. Cyril Ramaphosa was sworn in as the new president of South Africa following the resignation of Jacob Zuma. The budget speech held no great surprises given the current state of the economy, the main feature being a rise of 1% in... Read More

Global: Stretched valuations? US equities continued to improve over the month, as fresh economic data provided additional momentum to the market which began the year on a very positive note. Inflation continued to rise on the back of higher energy prices, and retail sales were indicative of a robust economy. Employment numbers also remained healthy with the unemployment number remaining unaltered at 4.1%. Read the full article Domestic: Improved political and economic sentiment A perceived reduction in political risk, and a renewed sense of positive global economic growth, resulted in a risk on environment prevailing on the JSE. Equity prices in December had already started to reflect this more positive sentiment. However, an inhibiting factor in January was the strength of the Rand which traded at its highest level against the USD in two and a half years. The resulting outcome... Read More

Global: Stretched valuations? US equities continued to improve over the month, as fresh economic data provided additional momentum to the market which began the year on a very positive note. Inflation continued to rise on the back of higher energy prices, and retail sales were indicative of a robust economy. Employment numbers also remained healthy with the unemployment number remaining unaltered at 4.1%. Read the full article Domestic: Improved political and economic sentiment A perceived reduction in political risk, and a renewed sense of positive global economic growth, resulted in a risk on environment prevailing on the JSE. Equity prices in December had already started to reflect this more positive sentiment. However, an inhibiting factor in January was the strength of the Rand which traded at its highest level against the USD in two and a half years. The resulting... Read More

Global. Macroeconomic data in the US continued to confirm a positive trend and this was reflected in equities maintaining their improvement. The Trump administration’s proposed tax reforms gained traction in both the Senate and Congress which provided further impetus for the markets. All the major US equity indices traded at record highs, with the Dow Jones returning 3.83%, the S&P 500 2.81% and the tech heavy NASDAQ 2.17%. Read the full article Domestic. For South Africa the moment of truth arrived during the month in the form of the three major ratings agencies pronouncing on their evaluations of the local economy. Fitch opted to keep its ratings unchanged at BB+ with a stable outlook. Moody’s opted to place its ratings on review for a downgrade – the decision being held over until after the February budget. S&P on the other... Read More

Global. Macroeconomic data in the US continued to confirm a positive trend and this was reflected in equities maintaining their improvement. The Trump administration’s proposed tax reforms gained traction in both the Senate and Congress which provided further impetus for the markets. All the major US equity indices traded at record highs, with the Dow Jones returning 3.83%, the S&P 500 2.81% and the tech heavy NASDAQ 2.17%. Read the full article Domestic. For South Africa the moment of truth arrived during the month in the form of the three major ratings agencies pronouncing on their evaluations of the local economy. Fitch opted to keep its ratings unchanged at BB+ with a stable outlook. Moody’s opted to place its ratings on review for a downgrade – the decision being held over until after the February budget. S&P on the other... Read More

Global: Growth continues In the US, macroeconomic data remained encouraging with the better than expected Q3 GDP growth number of 3% surprising on the upside. Results from the tech sector were encouraging whilst corporate earnings were above expectations. In spite of concern over stubbornly weak inflation, investors remained confident and markets achieved new highs. Read the full article Domestic: A sad tale Of particular significance for the local market was the release of the much anticipated Medium-Term Budget Policy Statement by Finance Minister Malusi Gigaba. It unsurprisingly painted a grim picture of the dire financial straits that the country is in. The main shock is that the projected revenue shortfall for 2017/18 is a staggering R50.8bn – due to weak economic growth and below par tax collection. This translates into a cumulative R209bn budget shortfall over the next three years.... Read More