Market Update – March 2014
Risk off, risk on markets Domestic markets continued to display considerable volatility during March as both global and domestic events impacted on investment sentiment. In the earlier part of the month risk off was largely dictated by indications of a slowdown in Chinese economic growth impacting negatively on South African exports of raw materials. This slowdown has increased speculation in the Chinese financial sector that weakening growth will prompt government policy makers to reconsider their aversion to introducing broad stimulus measures. The Chinese government faces a precarious balancing act of reining in credit expansion that often fuels the risk of loan default, while averting an economic slump that raises the odds of higher unemployment. Read the full article GTC Fund Performances The GTC High Equity Funds (previously Aggressive) have continued to deliver outperformance relative to the inflation adjusted target. Over the... Read More
Market Update – February 2014
Budget 2014/2015 Apart from Minister Pravin Gordhan’s budget speech, February brought with it interesting and counter intuitive developments both in the local equity and bond markets. The 2014 Budget focuses on interventions that are aimed at placing the economy on a new growth trajectory. Government’s primary objective is to raise real economic growth to between 5 and 6 percent per annum. This higher level of economic growth should boost state revenue and enable the government to increase expenditure on improving peoples’ lives by dealing with the high levels of unemployment, poverty and inequality. Read the full article The Rand shock absorber effect U.S.Federal Reserve chair Janet Yellen suggested before the Senate banking committee that the pace of the Fed’s economic stimulus plan tapering could be slowed if weakness in the American economy continued. Wall Street rallied as a result with the... Read More
Market Update – January 2014
‘Risk off’ environment hammers markets January was an eventful month, influenced largely by the United States Federal Reserve’s (Fed) decision to continue tapering its quantitative easing programme announced in December. Fed chairperson, Janet Yellen, announced a further reduction of $10 billion per month lowering the Fed’s purchases of securities to $65billion per month effective from February. Read the full article Market returns The ‘risk off’ withdrawal of funds from our shores led to negative returns across local markets as well as a significant weakening of the Rand against developed world currencies. The JSE All Share lost 2.36% over the month dragged down by Industrials (-4.6%) and Financials (-6.9%). The Resource sector delivered a strong 5.9% in January off the back of a stratospheric 27.5% delivered by the Gold Mining sub sector as well as positive performances from the other subsectors... Read More
