This is What Confident Investors Are Doing

South Africa stood out that past week as the only market to post positive returns amongst the major market indices considered below. The SWIX index gained 0.25%, while global and US markets slipped. The MSCI World fell 0.23% (ZAR), the S&P 500 dropped 0.34% (ZAR), and the NASDAQ led the decline with a 1.42% loss (ZAR).

Locally, gains were driven by strength in the communications sector, with support from IT, consumer staples, and materials. This resilience continues to reinforce investor confidence in the domestic market, particularly in a week marked by international uncertainty.

Gold continued on its record-breaking streak, crossing the $3,100 mark for the first time on 31 March. The rally reflects heightened global instability and persistent demand for safe-haven assets.

Zooming Out: This Weeks Major Economic Developments
In the United States, President Trump announced a new set of tariffs targeting imported motor vehicles. The announcement pressured the share prices major automakers and added further volatility to the market.

For South Africa, the implications could be significant. The country’s automotive sector, a key export industry, benefits from duty-free access to the US under the African Growth and Opportunity Act (AGOA). The new tariffs could threaten this dynamic, potentially disrupting a major contributor to South Africa’s export economy. The South African government has responded by trying to initiate diplomatic engagement with US counterparts in an effort to mitigate the potential fallout.

What Are Investors Doing?
Despite global market jitters and policy uncertainties, investors on our platforms remained active and focused, with our platforms recording continued net inflows into unit trusts.

Two themes stood out in investor behaviour:

1. A Strong Allocation Toward Local Multi-Asset Strategies
   South African multi-asset funds attracted over R4.4 million in net inflows during the week. These funds can provide a mix of equities, bonds, and cash with both local and offshore exposure, potentially offering investors a balanced strategy for growth with some downside protection. This trend suggests that investors are seeking robust, diversified portfolios.
   
   
2. Continued Demand for Offshore Exposure
   At the same time, global equity funds saw net inflows of more than R2.7 million. Investors are clearly maintaining a global mindset, using offshore allocations to diversify and participate in broader international opportunities.

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