The JSE continued its strong run into October (FTSE/JSE Capped SWIX Index +1.8% MoM), leaving the local bourse up 33.4% YTD. The shape of the JSE return in October was decidedly different to the themes which dominated for the first three quarters of 2025. Precious metal miners were responsible for two-thirds of the JSE’s YTD performance through September, with gold and platinum miners rallying by 184% and 173%, respectively, over those nine months. Meanwhile, stocks geared to the domestic economy were up 4% in aggregate over the same period. During October, though, the precious metal miners were a drag on JSE performance (gold miners -5% MoM and platinum miners -10% MoM), while the domestically geared companies rallied by 8% MoM collectively. While the gold price was up in October (+3.7% MoM), it dropped by 8% in the latter part of the month, breaking some of the momentum which had taken it to an all-time high of US$4,381/oz on 20 October in an incredible run of +110% since the start of 2024.
Capitec (+11% MoM) reported earnings growth of 26% YoY, active client growth of 8% YoY and a growing business banking segment (now > 40% of earnings). Asset manager Ninety One (+13% MoM) reported assets under management (AUM) growth of 9% QoQ, while an operating update from Discovery (+12% MoM) showed a favourable claims environment and positive new business volumes. MTN (+19% MoM) continued its positive share price momentum into October, leaving it 94% higher YTD. We Buy Cars (-17% MoM) delivered an operating update that fell short of investors’ lofty expectations, as did The Foschini Group (-16% MoM), which guided to a 20%-25% YoY drop in headline earnings (double the decline that analysts were anticipating).
The SA government’s 10-year borrowing rate ended October below 9% p.a. for the first time since 2021 (when US 10-year borrowing rates were <2% p.a.). The latest data showed inflation (3.4% YoY) still hovering around the 3% level, which is expected to be the level that the South African Reserve Bank (SARB) will begin targeting imminently. The falling yields on SA government debt drove substantial gains for bondholders, with the SA All Bond Index up 17% YTD. The local currency fared relatively well against a strong US dollar (-0.4% MoM).
