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OIG Monthly Market Review


  • FTSE JSE All Share Index up 1.8% for the month with SA Listed Property Index increasing by 9.3%

  • South African Rand strengthened by 2.7%

  • Headline inflation decreased remaining at the midpoint of the South African Reserve Bank’s (SARB) target range.

The South African stock market wrapped up the year positively, with the FTSE JSE All Share Index showing a 1.8% gain in December and a solid performance of 6.2% in the fourth quarter of 2023, contributing to an overall increase of 5.3% for the year. However, the market faced challenges due to significant exposure to the underperforming Chinese market throughout the year.

In December, property counters were among the top performers on the JSE, with the SA Listed Property Index impressively rising by 9.3% month-on-month, marking a 12.5% increase in the fourth quarter and a 2.5% uptick in 2023. The Financial Index (Fini-15), which is the largest listed financial companies, and Industrial Index (Indi-25), consisting of industrial stocks also posted gains of 5.3% and 0.2% for December, contributing to positive performances of 10.8% and 5.5% in the fourth quarter, and 15.1% and 14.8% throughout the year, respectively. However, the Resources Index (Resi-10), that tracks the 10 largest resources companies lagged in December, witnessing a 1.3% decline, with a slight improvement of -0.04% in the fourth quarter, but a notable drop of 18.7% in 2023.

Mining stocks, as a whole, experienced a 2.9% increase for the month, with platinum miners particularly standing out with a robust 19% surge, on the contrary, gold miners disappointed with a 2% decline.

Domestic economy-focused shares demonstrated resilience, led by impressive performances from banks up 18%, and insurers up 38% for 2023.

Examining the largest shares on the JSE by market cap, BHP Group, the largest company, recorded a remarkable 10.2% increase, and Anheuser-Busch InBev, the second-largest share, saw a more modest 1.6% rise in December. Prosus and Naspers experienced declines of 10.6% and 9.9%, respectively, influenced by their significant holding in Tencent, which faced challenges triggered by Chinese regulatory announcements of clamping down on online gaming.

The price-to-earnings ratio (P/E) is a key metric for gauging stock valuation, revealing whether a stock is over or undervalued based on its past or future earnings. A low P/E suggests potential undervaluation, offering investors an opportunity to buy with the expectation of future price appreciation aligned with earnings growth. The graph illustrates that the P/E ratio of the FTSE JSE All Share Index is significantly below both the median and previous low levels.

All share P/E Ratio

*Source: BCI The Boutique Bulletin

In December, the rand strengthened by 2.7% against a weak US dollar; however, it closed the year 7.2% lower compared to the start of 2023.

November's headline Consumer Price Index (CPI) provided an unexpected positive surprise, contracting to 5.5% year-on-year from 5.9% in October. This marked the first decline since July. The reduction was primarily driven by a significant 5.5% monthly drop in the fuel price index, leading to a notable decrease in the annual fuel rate in November. Consequently, the yearly transport rate also declined from 7.4% to 4.3%. Core inflation, excluding the more volatile food and energy costs, saw a slight uptick to 4.5% in November from 4.4% in October, remaining at the midpoint of the South African Reserve Bank’s (SARB) target range of 3% - 6%.

Despite the global increase in risk appetite, non-resident investors remained net sellers in the domestic capital market, with equity outflows totalling R15.9 billion, as reported by JSE data. This contributed to a full-year outflow of R154.8 billion.

South Africa posted a trade surplus of R21 billion in November 2023 - above market estimates of a R5.8 billion surplus.

The official unemployment rate, as reported by Statistics South Africa (Stats SA), decreased to 31.9% in the third quarter of 2023, down from 32.6% in the second quarter.

The return of more of Eskom's energy utility fleet to service, coupled with a substantial private sector renewable energy pipeline, is expected to lead to a significant reduction in load shedding in the second half of 2024. This development is likely to result in a smaller impact on economic growth over the next three years. Many businesses have proactively invested in alternative energy sources. While concerns over energy restrictions are easing, logistics failures are anticipated to take centre stage as a growth concern in 2024. South Africa has taken the lead as Africa's largest producer of wind and solar power, surpassing early pioneers Egypt and Morocco in 2014. The Renewable Energy Independent Power Producer Programme (REIPPPP), initiated in 2011, played a pivotal role in propelling South Africa to the forefront of renewable energy generation on the continent.

Africa's wind & solar energy powers up

*Source: Ember |


  • In December 2023, global markets posted positive gains. The MSCI World index increased by 4.9% while US stocks rose with the S&P 500 up by 4.4% and the Nasdaq by 5.5%. The UK's FTSE-100 increased by 3.7%. Emerging markets, represented by the MSCI EM, also had a positive month with a 3.9% increase.

  • Inflation slowed down in the US, Euro area as well as in the UK reaching its slowest pace in 18 months

Investors experienced a positive end to 2023, except for China, the world's second-largest economy, most global equity markets concluded the year with gains, with MSCI World showing a monthly increase of 4.9%, 11.5% up for the fourth quarter, and an impressive 24.4% for 2023.


US markets reversed losses in November and December, recording significant gains for 2023.  This led to US stocks concluding the year with a nine-week winning streak, the longest since 2004. The blue-chip S&P 500 index demonstrated a monthly rise of 4.4%, marking an 11.2% increase in the fourth quarter and a substantial 24.2% year-on-year growth in 2023.

The Nasdaq Index, consisting mainly of technology stocks, demonstrated a monthly growth of 5.5% and achieved its sixth-biggest annual gain since the index was launched in 1971, with an impressive 43.4% year-on-year surge. This substantial yearly jump was driven by the outstanding performance of the Magnificent Seven stocks, namely Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla.

In November, the Fed signalled the end of its rate-hiking cycle, with three expected rate cuts in 2024. They held rates steady in the last meeting, marking the third consecutive meeting without a hike in interest rates.

US Inflation has eased but remains elevated, the data showed a decrease, with headline inflation at 3.1% year-on-year, core inflation (excluding food and energy) at 4.0%, and core personal consumption expenditures (PCE), the Fed's preferred inflation gauge, slowed to 3.2% in November.

In 2023, consumer spending remained resilient, but we anticipate a shift due to factors like slower real income growth, increasing consumer debt, and reduced pandemic savings. Additionally, business investment is expected to grow modestly amid higher financing costs. Although the labour market remains robust, signalling a milder growth downturn, the Bloomberg median consensus forecast for 2024 improved from 0.6% in August to 1.2% in December 2023. Despite this, a 50% likelihood of a recession within the next twelve months looms.

United Kingdom (UK)

The UK's leading FTSE-100 index saw a 3.7% increase, contributing to a 3.8% rise throughout 2023 and a 1.6% gain in the fourth quarter.

Inflation exhibited a slowdown, marking its slowest pace in 18 months. The year-on-year comparison decreased from 4.6% to 4.3% in October.

The Bloomberg median consensus growth forecast for 2024 declined from the initial expectation of 0.9% in December 2022 to 0.4%. This downward revision in growth forecasts coincided with upward adjustments in inflation projections.


Despite the sluggish European economy, which hovered near recession levels at year-end, major European markets saw solid gains in 2023, recovering from a challenging 2022. Germany's DAX Index rose by 3.3% monthly, contributing to an 8.9% increase in the fourth quarter and an overall growth of 20.3% throughout the year. France's CAC Index closed December 3.2% higher, with a 5.7% increase in the fourth quarter and a total gain of 16.5% in 2023.

November witnessed a decline in euro area inflation, dropping to 2.4% year-on-year from October's 2.9%. In Germany, November inflation marked its fifth consecutive monthly slowdown, reaching the lowest level since June 2021 at 3.2% year-on-year, down from October's 3.8%. France experienced a cooling inflation trend in November, registering 3.5% year-on-year, down from October's 4.0%, attributed to slowdowns in energy prices, services, and manufactured goods.

Over the past year, the Bloomberg median consensus growth forecast for 2024 has decreased by more than half, dropping from 1.4% in December 2022 to 0.6%. Nominal wage growth is expected to ease in 2024, reflecting emerging signs of a cooling labour market.

Emerging Markets (EM’s)

Emerging markets had a positive month and year-to-date performance with the MSCI EM up 3.9% for December and, 10.1% for the year. However, Chinese stocks faced challenges in December due to unexpected regulatory actions, particularly affecting online gaming. Benchmarks for Chinese stocks listed in the US, Hong Kong, and on the mainland ended 2023 on a down note, with concerns about China's economic recovery. Hong Kong's Hang Seng Index remained unchanged in December, down -4.3% in the fourth quarter and -13.8% in 2023, while Shanghai Composite Index dropped by 1.8% for the month, -4.4% for the last quarter and, -3.7% for the year.

Global Interest Rates & Inflation

*Source: TradingEconomics


December marked another positive month for investors, building on the upbeat performance observed in November across equity and fixed-income markets. Major central banks, maintaining policy rates in December, signalled the conclusion of tightening measures. Despite the current optimism, the outlook for the economy, monetary policy, and corporate earnings presents paradoxical challenges, setting the stage for significant volatility in the first half of the year. In navigating the financial landscape of 2024, a proactive and diversified investment approach is paramount.

Fund Performance Review | December 2023

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