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MONTHLY UPDATE

February 2021

Major global equity markets closed the month of February with positive returns, despite a drop in equity markets over the last week of February, as the sell-off in bonds unnerved equity markets.

In the U.S. the expected approval of President Joe Biden’s $1.9 trillion coronavirus relief bill should boost the U.S. recovery with positive spill-over effects for global financial markets. Surprise inflation is also being closely monitored by investors as higher commodity prices have contributed to higher inflation expectations in recent weeks. Vaccine news remains positive with various studies out of the UK and Israel confirming that the vaccines are highly effective in reducing infection, hospitalisation and deaths. Although new and unpredictable mutations of the virus remain a potential risk.

Value sectors, such as energy and financial services have outperformed of late, thanks to expectations of a rapid return to a post-pandemic normality, which lifted oil prices and steepened yield curves. Whilst we appreciate that numerous businesses in these sectors appear to be cheap, our focus remains on investing in high quality businesses with steady growth rates and sustainable business models.

Equity markets are likely to remain volatile in the short-term but looking through the inevitable short-term noise, the combination of improving global growth helped by more stimulus, vaccines and low interest rates augurs well for growth assets for the rest of the year.

Market moves of the month

SA MARKETS LAST PRICE FEB 2021 MOVES YTD MOVE
JSE ALL-SHARE 66 138 5,87% 11,33%
RESOURCE 10 67 460 11,73% 17,17%
INDUSTRIAL 25 86 144 1,99% 10,58%
FINANCIAL 15 12 200 4,37% 1,16%
SA LISTED PROPERTY 285 8,60% 4,58%
GLOBAL MARKETS  LAST PRICE FEB 2021 MOVES YTD MOVE
DOW JONES 30 932 3,17% 1,06%
S&P 500 3 811 2,16% 1,47%
NASDAQ 13 192 0,93% 2,36%
EURO STOXX 50 3 636 4,45% 2,36%
FTSE 100 6 483 1,19% 0,35%
NIKKEI 225 28 966 4,71% 5,55%
SHANGHAI 3 509 0,75% 1,04%

 

CURRENCIES  LAST PRICE FEB 2021 MOVES YTD MOVE
GBPUSD 1,39 1,48% 1,67%
USDZAR 15,13 -0,33% 2,97%
GBPZAR 21,04 1,30% 4,74%
EURZAR 18,26 -0,76% 1,73%

Source: Factset

Explore the chartbook for the month of February.

Latest Insights

Finance Minister Tito Mboweni tabled the national budget in Parliament on Wednesday, 24 February, outlining South Africa’s spending, tax and borrowing plans for the next three years.

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