URGENT ALERT: Please beware of fraudulent WhatsApp groups and other groups across Social Media pretending to be affiliated with Anchor and Anchor staff members. Do not engage with these malicious and fraudulent groups in any way. Please direct all queries to invest@anchorcapital.co.za.

April local commentary: Diversified miners and property stocks push the JSE higher

South African (SA) stocks recorded a sixth-consecutive monthly gain (FTSE/JSE Capped SWIX +0.8% MoM) – the longest winning streak for local equities since 2014/2015. The April gains added to a local equity market rally, which has pushed the local bourse up over 30% since early November (around the time of the first announcements of effective COVID-19 vaccines). The April gains were largely thanks to the diversified miners, which were up over 4% in aggregate as commodity prices rallied (iron ore +20% MoM), and the property stocks, which had a stellar month (+11.6% MoM). Property stocks have had a torrid past few years but are now up c. 60% since November (although still around 40% below their late-2017 highs).

At an individual stock level, Investec was noteworthy (+29% MoM) as deep value shares caught investors’ attention and its exposure to the UK banking sector helped it participate in a rally in European banking stocks. Sasol (+15% MoM) benefited as Brent crude oil approached US$70/bbl and rand-hedge heavyweights, Richemont (+5.5% MoM) and Anheuser-Busch (+10.5% MoM) overcame a strong rand to contribute meaningfully for the month. Anheuser-Busch rallied as analysts started to become more bullish on the prospects of the brewer with economic activity normalising, while Richemont rose in sympathy with luxury peer LVMH as that company released earnings which shattered expectations. The other major rand-hedge share, British American Tobacco had a poor month (-4% MoM) as regulators announced a plan to relook at a ban on menthol cigarettes in the US, which accounts for more than a quarter of the company’s earnings. Index heavyweights, Naspers and Prosus were also a drag on the month’s performance (-6% MoM in aggregate) as management’s attempts to reduce the discount of their market cap to the value of the underlying investments, by selling US$14.6bn of their largest investment (in Tencent), failed to impress investors.

During April, inflation data again came in towards the bottom end of the SA Reserve Bank’s 3%-6% range (at 3.2% YoY), while retail sales were up 6.9% YoY in March and exports continued to surge, leaving SA with a R52bn March trade surplus. The SA 10-year government bond yield followed global yields lower, ending April at 9.3% and the local currency rallied further (+2% MoM) against a weak US dollar, leaving it 33% stronger than the R19/US$1 level it reached in April 2020.



Submit your details and we’ll give you a call back to assist and advise you on your investment.


Subscribe to our newsletters to receive regular market commentary, research and updates from the Anchor team. Select between our Individual or Financial Advisor newsletters by selecting the relevant tab below.

WEBINAR | The Navigator – Anchor’s Strategy and Asset Allocation, 2Q24

Anchor CEO and Co-CIO Peter Armitage will host the webinar, provide an introduction to current global and local market conditions and give his thoughts on offshore equities. Together with Head of Fixed Income and Co-CIO Nolan Wapenaar, Pete will also discuss Anchor’s strategy and asset allocation for 2Q24, focusing on global equities and bonds. In addition, Fund Manager Liam Hechter will provide insights into local equities, highlighting some investment ideas; Global Equities Analyst James Bennet will discuss Ferrari and give an update on Tesla, and finally, Analyst Thomas Hendricks will participate in a Q&A with Peter, explaining the 10-year US Treasury to attendees.