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.

January local commentary: The JSE records a positive start to 2022

The local bourse had a good start to 2022 (FTSE/JSE Capped SWIX +2.4% MoM) as it benefitted from improved sentiment towards emerging markets (EMs) and a rally in commodity prices. Mining shares were amongst the best performers (+5% MoM). The Peoples Bank of China (PBOC) has started loosening monetary policy in an attempt to boost flagging economic growth and the prospect of stronger economic growth in China helped boost commodity prices (iron ore +12% MoM) and drove the share prices of diversified miners higher (BHP +5% MoM, Anglo American +4% MoM). Geopolitical tensions surrounding the build-up of Russian troops on the border of Ukraine placed pressure on a tight global energy market, driving Brent crude oil and thermal coal prices higher (17% MoM and 26% MoM in US dollar terms, respectively). Sasol and Thungela were the biggest local beneficiaries of spiking energy prices (+33% MoM and +11% MoM, respectively).

Domestically focussed companies also benefitted from improving sentiment towards value stocks, with the local banks having a good month (ABSA +11% MoM, Nedbank +9% MoM and Standard Bank +7% MoM). British American Tobacco was also a beneficiary of improving sentiment towards value stocks (+13% MoM), despite a 3.7% MoM headwind from rand strength against the US dollar. MTN was amongst the best-performing local shares in January (+13% MoM) boosted by the announcement of a 45% YoY jump in profits in its Nigerian business. Local currency strength weighed on Naspers and Prosus, which both ended January lower despite a 6% MoM return in Hong Kong dollar terms from their largest investment, Tencent. Gold shares were amongst the worst performing on the local bourse in January (-10% MoM) as the prospect of higher global rates weighed on the gold price (-5% MoM in rand terms).

The January meeting of the South African Reserve Bank (SARB) delivered a much anticipated 0.25% rate hike, the second of the current hiking cycle, pushing the repo rate to 4% – still well below the 6.25% level it was at going into the pandemic. The hike came in the wake of the country’s highest inflation print in almost 5 years (+5.9% YoY), though when stripping out the volatile food and energy components, core inflation for December came in at a much more muted 3.4% YoY increase. The tone of the SARB was significantly less hawkish than the market had priced for, with one SARB member even voting to keep rates unchanged, and SA 10-year government bond yields ended the month unchanged at 9.8%, despite a spike in global bond yields.



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.