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Foreign investors have accelerated their (net) selling of equities on the JSE, with sales 40 percent greater thus far in 2023 than in the same period in 2022. To last Friday, non-SA investors sold a net R103 billion of equities, versus R73 billion in the first 40 weeks of last year.
Year to date, the JSE All Share Index (Alsi) is down 1,1 percent. (The flows picture for bonds, while still barely positive for the year, is down 70 percent versus 2022.)
Foreign selling has been a firm theme of the past four years, with the last burst of net buying being a ‘Ramaphoria’ induced pop in 2018, following Cyril Ramaphosa being appointed president.
The decline began in the final years of the Jacob Zuma administration. This is according to a chart from Ninety One, understood to be part of a presentation to clients and published on X (neé Twitter) by investor and well-known commentator Karin Richards.
Cumulatively, outflows are almost certainly more than US$40 billion by this stage (the chart has data to May 2023).
The steadily weakening rand impacts the returns of foreigners, and with domestic earnings growth moribund – or non-existent – there’s not an awful lot to be excited about. In dollar terms, the performance of our market is among the worst in the world.
According to data from PSG Wealth Old Oak, the South African country ETF (exchange-traded fund) is the third worst globally when measured to Friday, 6 October. The ETF is down 11.3% this year; the two worst performers, Thailand and Hong Kong, are at -17 percent and -16 percent, respectively. – Moneyweb
Online Reporter