Developed market equities rallied to record highs in December as China responded to a trade deal agreed to by Trump that would halt higher trade tariffs and represent the first phase in defusing the ongoing trade war that has shaken the global economy. Astronger Chinese equity market has also benefited from a recent Chinese Central Bank stimulus package. Locally, the rand strengthened on the back of the recent reprieve in the trade wars between the US and China which also benefited other EM countries. The lack of import interest has also helped the Rand appreciation. South African bonds performed well in December as they continue to offer better real yields as opposed to other emerging market countries.
The JSE All Share Index (up 3.3%) performed well as resources rallied. Resource stocks (up 0.7%) performed best followed by Industrials (up 2.3%) and Financials (up 0.7%). Both Mid-cap shares (up 4.7%) and Large-cap (up 3.6%) performed well this month while Small-cap shares (up 0.2%) were marginally positive.
The MSCI World Index ended the month up 3.6% in US Dollar terms. Emerging Market equities outperformed their Developed Market peers and ended the month up 7.5%.
Both the South African Listed Property sector (down 2.1%) and the SA REITs sector (down 2.7%) managed to underperform cash for the month (the only local asset classes to do so).
The Rand appreciated 4.6% against the US Dollar, 2.8% against the Euro and 2.3% against the Pound Sterling.
In December the Platinum price (up 8.2%) outperformed both the Gold price (up 3.7%) and the Oil price (up 5.7%) in US Dollars.
