What a start to 2023!

At the end of January we can celebrate a strong performance in most asset classes. The S&P500 is up almost 6%, the JSE is up a whopping 10% and the Hang Seng is up 14%. Europe is also flying, with the Eurostoxx 50 up 10%. We can expect a choppy market for the rest of the year but investors are sensing a change in the interest rate cycle and a possible soft landing for world growth.

In South Africa, the rand as well as the companies relying on the South African consumer, will remain vulnerable for as long as we cannot guarantee a reliable energy situation, and we will only see the full effect over the future months or years owing to the lag effect. That being said, as an international investor we know that South Africa is only a very small part of our available investment universe (graph below).

When we look at the companies listed on the JSE, we see very little red and a lot of green. Anglo American is up 15%, Richemont is up 18%, Goldfields is up 20% and Naspers up 24%.

Perhaps 2022 was just the reboot we needed, and 2023 will be the start of a fresh, positive investment cycle. As Confucius said in 500 BC, “Our greatest glory is not in never falling, but in rising every time we fall”.

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