Good morning and welcome to the monthly Signal Wealth update.
We hope that you are all fit and healthy and that you are enjoying the additional freedom that comes with Level 1 of lockdown and the long weekend just past. This month’s commentary comes courtesy of Ninety One:
South Africans took to the polls yesterday and at the time of writing, it seems that the larger parties have lost some ground in a number of the major municipalities, which could lead to more challenging coalitions.
With 2 months left of 2021, October gave markets the lift needed to put the JSE back in high double digit territory. Thanks to a series of earnings beats, the Dow and S&P 500 are both in record territory, while the Nasdaq is closing in on a record level. Our market is also trading well above 67 000, while the Rand has come under renewed pressure as international factors and lower commodity prices provide headwinds.
The major themes driving headlines and market direction remain China; inflation and interest rates and energy prices. These will undoubtedly continue to weigh on market sentiment as we close out 2021, so expect volatility to continue. It is therefore important that our valued clients remain focused on your longer term investment goals, rather than on short term noise. The chart of the week (below) again highlights the great value of not falling into the traps of making emotional mistakes when markets go through tough times. A reminder that in most instances, doing nothing should be the default setting for most investors.
It’s said that bad news travels faster than good news and that is what differentiates investors from market returns.
Have a great short week and please shout if you need to discuss anything.
