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<\/a><\/p>\nThe 12% gain in South Africa\u2019s main stocks gauge this year is less than half the 26% advance by its emerging-market peers.<\/p>\n
That partly reflects unease among investors over management of the economy under Zuma, who fired his respected finance minister in March, and concern that the ANC won\u2019t select a candidate focused on reinvigorating the economy or decisively tackling corruption.<\/p>\n
Zuma\u2019s term as president ends in 2019.<\/p>\n
Foreign investors have sold a net R65 billion ($4.9 billion) of South African stocks this year, following sales of R124 billion over the whole of 2016.<\/p>\n
HSBC Holdings said in July \u201cthere are more exciting opportunities elsewhere\u201d as it cut South African equities to neutral from overweight.<\/p>\n
Zuma is ensuring that he anoints his successor, Jefferies Hong Kong, chief global equity strategist Sean Darby said earlier this month, just after the president survived an eighth bid by opposition lawmakers to remove him in a no-confidence vote.<\/p>\n
Jefferies maintained its bearish view on South Africa within its global asset allocation.<\/p>\n
<\/p>\n Here are further comments about South African stocks:<\/p>\n UBS \u201cWe are underweight MSCI South Africa in our emerging market intra-equity strategy. We also have a cautious view on South African sovereign debt and the rand.<\/p>\n MSCI South Africa is trading above 20 times 12-month-trailing P\/E, well above its 10-year average. \u201cIn our view, the market is trading at expensive valuations amid low earnings growth.\u201d<\/p>\n \u201cWe continue monitoring the political dynamics ahead of the ANC conference in December, the rating announcements and also the fundamentals such as fiscal policy and growth-inflation dynamics.\u201d<\/p>\n Citigroup<\/strong><\/p>\n \u201cThere is no doubt that investors are underweight South African equities overall, it\u2019s partly the consequence of the turmoil that we\u2019ve got in terms of the lack of transparency on a policy level when it comes to the economy.<\/p>\n \u201cEmerging-market funds and analysts are doing a tremendous amount of work on South African stocks and updating their models, re-looking at their valuations and even second-guessing themselves about their lack of position on South Africa.<\/p>\n But it feels like the next step, the leap of faith that leads to fund managers buying, is not happening because of the lack of transparency and predictability about the future.<\/p>\n \u201cVery few people are looking beyond the next six months.<\/p>\n<\/a><\/p>\n
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