Global equities have continued to perform well in September, driving to new all-time highs during the month, with tech shares leading the way for the year, as the S&P 500 continues its upward trend. The US Fed cut rates for the first time this year, signalling a more dovish tone from the FOMC. Gold prices also hit record highs, taking gains of over 40% for the year to date. With the market pricing in a further 100 bps of rate cuts over the next 12 months, there remains a risk that potential tariff inflationary impacts could be underestimated.
South Africa experienced a 0.8% quarter-on-quarter growth in its GDP, outperforming expectations and indicating a modest yet widespread improvement in economic activity in the country. The SARB maintained unchanged rates during the latest MPC meeting, citing inflation risks and a preference to monitor the economy for new data. The All Share Index performed well over the month, again led by the resources sector. The Rand continued to strengthen against developed market currencies despite negative headlines from the Madlanga commission.
- The JSE All Share gained ground over the month, up 6.6%.
- Boosted by Resources up by 25.5% followed by Industrials up 1.3%, Financials were in the red, declining -1.9%.
- Small-caps up 0.9% a modest gain, outperformed by Mid-caps up 4.3%, while Large-caps up 7.9% won out the month.
- South African property markets were down for September, with the ALPI down -1.0%, while the S&P SA REIT Index lost -0.8%.
- SA Nominal Bonds up 3.4% benefited from global appetite for EM bonds, while Inflation-Linked Bonds ticked up by 2.8%.
- Developed market equities performed well in September but were outpaced by Emerging market equities which posted strong gains. The MSCI World Index gained 3.3% in USD while the MSCI Emerging Market Index soared 7.2% higher.
- The Rand continued to strengthen relative to most major currencies in September. Relative to the U.S. Dollar (Rand appreciated 2.5%), the Euro (Rand appreciated 2.1%) and the Pound Sterling (Rand appreciated 2.1%).
- Platinum continues its bullish trend up 16.0%, followed by Gold up 10.6%, while Brent Crude dropped -1.6% over the month.
Source: Factset
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