Global equity markets took their foot off the gas as the year came to an end. Developed market equities idled along, as the S&P 500 closed positively for the eighth month in a row. A cut in US interest rates helped to bolster returns, the tight split between FED officials gave markets enough hesitation to mute returns. Emerging market equities outperformed their developed market peers, as the US dollar continued to weaken and oil prices fell.
Local equities jumped higher, supported by both the Financials and Resources sectors. A four-decade record in platinum price growth, as well as a weaker dollar, contributed to performance. Budget deficit improvements and a widening trade surplus added to improved sentiment for South African assets overall. Foreign inflows into local fixed income instruments supported nominal bonds and inflation-linked bonds.
- The JSE All Share finished the year celebrating, ending December up 4.6%.
- Resources (up 5.7%) continued their impressive growth streak, as Financials (up 7.7%) rocketed higher, and Industrials (up 1.9%) returned modest growth.
- Small-caps (up 2.4%) climbed into the green, as Mid-caps (up 4.5%), and Large-caps (up 4.7%) stole the show.
- South African property markets lagged equities, but still ended in the positive. The ALPI inched up, adding 0.1%, while the S&P SA REIT Index reported a 1.4% gain.
- SA Nominal Bonds (up 2.8%) gained, and Inflation-Linked Bonds also bounced (up 2.9%) outperformed by a hair.
- Developed market equities reported respectable gains, as the MSCI World Index climbed (up 0.8% in USD), but lagged emerging market equities, as the MSCI Emerging Market Index closed ahead (up 3.0% in USD).
- The Rand strengthened against major currencies. Relative to the US Dollar (Rand appreciated 3.3%), the Euro (Rand appreciated 2.1%) and the Pound Sterling (Rand appreciated 1.8%).
- Gold continued to grow steadily, up 2.5%, but was overshadowed by Platinum which launched 21.3% higher. Brent Crude dropped 3.7%, ending the year much lower.
Source: Factset
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