November 2021 Update
F&A Monthly Update | November 2021
Our last Monthly for the year! Difficult to believe it is nearly Christmas, but still, what a wonderful time of the year. Wishing you a safe and restful Christmas period, and a wonderful start to 2022.
More great content from Brendan, below.
November 2021 Update
This month's piece is compiled by Brendan de Jongh, SA Head of Research - PortfolioMetrix.
LOCAL UPDATE
South African (SA) asset classes generally held up well over the month, considering the environment, with global unhedged bonds the best performing asset class. The rand weakened sharply, driving much of the performance of offshore asset classes in ZAR. Local equities remained positive, driven by resource stocks and rand hedged industrials. The worst performing asset class was local cash, while SA bonds still offered positive returns as the yield curve flattened somewhat on the back of a rate increase by SARB.
GLOBAL UPDATE
November proved to be a volatile month in general. A new Covid variant (Omicron) was discovered, prompting global growth concerns and weaker equity markets. Information is limited about its potency and efficacy of existing vaccines, but symptoms appear milder and economies have swiftly reintroduced preventative measures. Mainland Europe continues to struggle with its 4th Covid wave, with hospitalisations reaching concerning levels. All the while inflation continues to surge upwards, driven by energy prices rising and supply shortages. Central banks had appeared to be preparing to tighten monetary policy but the latest Covid news may have pushed that out further which prompted a decrease in higher quality bond yields, raising bond prices. Follow this link for more detail on events which transpired in the month.
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