December 2022 Update
F&A Monthly Update | DecemBER 2022
Hi all,
Welcome to a very warm 2023! A new year, filled with new promises, and hope, and in spite of all the noise, there is much to be hopeful for! Our hope is that each of us has a strong year, filled with progress, healthy challenges for growth, and fun.
We have some exciting developments on the horizon, so keep an eye out for that! For now, please enjoy the below from Brendan.
Sending love,
Richard and the F&A team
December 2022 Update
This month's piece is compiled by Brendan de Jongh, SA Head of Research - PortfolioMetrix.
GLOBAL UPDATE
December saw a bit of a retracement of the jubilation from November. Major developed market central banks delivered 0.5% interest rate hikes, as was expected. But communication accompanying the changes served as a reminder that inflation remains a threat, denting optimism of market participants – particularly in the US. But further evidence of China’s willingness to drop their zero COVID policy provided some welcome news to markets. Overall markets struggled, with the concern of higher for longer rates hitting US companies harder than most, especially those companies that have higher growth characteristics. Follow the link below for more detail on events that transpired in the month.
LOCAL UPDATE
The South African (SA) equity market fared slightly better than offshore equities in what has been a difficult month for risk assets globally. Although SA equity outperformed developed markets it underperformed the broader emerging market index driven by underperformance in the resources sector. The best performing asset classes for SA investors were SA cash and bonds as they both provided positive returns. Local bonds performed relatively well in a volatile August as global markets struggled to digest the prospect of further rate hikes. Local and global property were the worst performers with returns of -5.4% and -4.4% (in ZAR) respectively.