{"id":843743,"date":"2025-11-19T09:52:34","date_gmt":"2025-11-19T07:52:34","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=843743"},"modified":"2025-11-19T09:52:40","modified_gmt":"2025-11-19T07:52:40","slug":"south-africas-markets-a-quiet-outperformer-in-a-noisy-world","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/industry-news\/843743\/south-africas-markets-a-quiet-outperformer-in-a-noisy-world\/","title":{"rendered":"South Africa\u2019s Markets: A Quiet Outperformer in a Noisy World"},"content":{"rendered":"\n<p><em>By Kim Zietsman, Laurium Capital<\/em><\/p>\n\n\n\n<p>In a global investment environment defined by uncertainty, fluctuating rate cycles and uneven growth, South African markets have quietly delivered\u2014and in many instances, outperformed.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong><a href=\"http:\/\/www.lauriumcapital.com\/?utm_source=BusinessTech&amp;utm_medium=Article&amp;utm_term=November+2025\" target=\"_blank\" rel=\"noreferrer noopener\">Grow your wealth with Laurium Capital<\/a>.<\/strong><\/li>\n<\/ul>\n\n\n\n<p>Recent data compiled by Laurium Capital to 30 September 2025, highlights the strong long-term performance of South African equities and bonds relative to global peers, including the United States.<\/p>\n\n\n\n<p>Despite operating within a challenging domestic landscape, South Africa continues to offer compelling long-term value, high real-yield opportunities, and structural upside as reforms begin to take root.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How SA Has Performed Relative to the US<\/h2>\n\n\n\n<p>A striking feature of South Africa\u2019s investment story is how well its markets have performed relative to the world\u2019s most admired equity market \u2013 the United States.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Nominal USD Returns Over Time<\/h2>\n\n\n\n<p>Over the <strong>last 25 years<\/strong>, SA equities have <strong>outperformed US equities<\/strong>, delivering:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>SA Equities:<\/strong> 10.3% annualised<\/li>\n\n\n\n<li><strong>US Equities:<\/strong> 8.8% annualised<\/li>\n<\/ul>\n\n\n\n<p>This outperformance comes despite currency volatility, lower economic growth, and frequent political uncertainty \u2013 reinforcing the long-term strength and resilience of the JSE.<\/p>\n\n\n\n<p>Over shorter periods, SA equities continue to hold their ground:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Last 5 years:<\/strong> SA 13.7% vs US 14.6%<\/li>\n\n\n\n<li><strong>Last 10 years:<\/strong> SA 10.6% vs US 14.9%<\/li>\n<\/ul>\n\n\n\n<p>Meanwhile, South African bonds have delivered substantially higher returns than US bonds across all measured periods, benefiting from high real yields and consistent demand.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Real Returns in ZAR<\/h2>\n\n\n\n<p>In real (inflation-adjusted) terms, SA investors have also been well rewarded:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>SA real equity returns:<\/strong> 12.1% (5 yrs), 6.7% (10 yrs), 8.3% (25 yrs)<\/li>\n\n\n\n<li><strong>SA real bond returns:<\/strong> 5.8% (5 yrs), 5.5% (10 yrs), 4.5% (25 yrs)<\/li>\n<\/ul>\n\n\n\n<p><em>Source: Bloomberg<\/em><\/p>\n\n\n\n<p>This demonstrates that South Africa has been, and continues to be, a fertile environment for generating long-term real wealth.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Outlook for South African Equities: Fundamentals Strengthening<\/h2>\n\n\n\n<p>South African equities enter the coming years from a position of relative strength and improving fundamentals.<\/p>\n\n\n\n<p>The long-term data shows that the SA market can match\u2014and over long cycles, even outperform\u2014US equities.<\/p>\n\n\n\n<p>Several cyclical and structural tailwinds are now aligning to support further upside.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Improving Terms of Trade<\/h2>\n\n\n\n<p>South Africa\u2019s commodity-linked economy is benefiting from firmer prices in gold and platinum group metals.<\/p>\n\n\n\n<p>This lifts earnings, boosts tax receipts, and reduces fiscal pressure.<\/p>\n\n\n\n<p>Higher commodity prices historically spill over into stronger consumer spending\u2014we expect this trend to re-emerge.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Supportive Consumer Dynamics<\/h2>\n\n\n\n<p>Lower inflation and expected interest-rate cuts will ease pressure on households, lifting disposable income.<\/p>\n\n\n\n<p>Combined with the positive effects from commodity-linked income, this creates a more supportive backdrop for domestic consumption and earnings.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">A More Stable Political Environment<\/h2>\n\n\n\n<p>The Government of National Unity (GNU), while not without challenges, has delivered greater political stability and renewed focus on medium- and long-term reforms.<\/p>\n\n\n\n<p>The business environment is improving, albeit slowly, under more pragmatic, collaborative governance.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Structural Reforms Beginning to Deliver<\/h2>\n\n\n\n<p>Several reforms, initiated even before the GNU, are now gaining visible traction:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Loadshedding has been largely eliminated<\/strong>, removing a major economic drag.<\/li>\n\n\n\n<li><strong>Logistics infrastructure is being rehabilitated<\/strong>, with private-sector participation expected to significantly improve rail and port capacity over the next three years.<\/li>\n<\/ul>\n\n\n\n<p>Progress in these areas has the potential to shift South Africa\u2019s medium-term growth trajectory meaningfully higher.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Global Conditions Favour Emerging Markets<\/h2>\n\n\n\n<p>Macro and geopolitical uncertainties, along with a potential US rate-cutting cycle, could weaken the US dollar.<\/p>\n\n\n\n<p>Historically, a softer dollar:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Supports emerging-market capital flows<\/li>\n\n\n\n<li>Boosts commodity prices<\/li>\n\n\n\n<li>Improves relative competitiveness<\/li>\n<\/ul>\n\n\n\n<p>South Africa stands to benefit more than most from this dynamic.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Attractive Valuations<\/h2>\n\n\n\n<p>Despite the improving outlook and long-term relative outperformance, SA equities still trade at substantial discounts to both developed and emerging-market peers.<\/p>\n\n\n\n<p>This creates a highly attractive entry point for investors seeking value, yield, and real return potential.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Key Takeaways<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Global markets \u2013 particularly the US \u2013 appear expensive<\/strong>, pricing in a high degree of optimism.<\/li>\n\n\n\n<li><strong>Macro risks, geopolitical pressures and declining rates and diversification away from the US dollar, may continue to add pressure to the US dollar<\/strong>, a tailwind for emerging markets like South Africa.<\/li>\n\n\n\n<li><strong>South Africa\u2019s market performance has been strong but narrow<\/strong>, driven by largely precious metals and Prosus, while domestic sectors have lagged.<\/li>\n\n\n\n<li><strong>A weaker USD, stronger precious metal prices, the new inflation-targeting framework, and ongoing domestic reforms create powerful tailwinds for SA domestic equities<\/strong>, improving prospects for a broader market re-rating. We have largely seen these tailwinds priced into SA government bonds, along with a credit rating upgrade from S&amp;P. However, this has not been priced into domestic focussed SA Inc shares.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Conclusion: A Mispriced Opportunity in Global Markets<\/h2>\n\n\n\n<p>South African equities and bonds have delivered exceptional long-term returns \u2013 often surpassing the United States \u2013 despite operating within a far more challenging macro environment.<\/p>\n\n\n\n<p>With improving terms of trade, strengthening domestic fundamentals, reform momentum and favourable global conditions, the outlook for SA equities is increasingly constructive.<\/p>\n\n\n\n<p>For investors willing to take a medium- to long-term view, <strong>South Africa remains one of the most attractive and underappreciated opportunities in global emerging markets.<\/strong><\/p>\n\n\n\n<p>The foundations for a multiyear re-rating are in place, and the value on offer remains compelling.<\/p>\n\n\n\n<p>For more information on how to access these market opportunities and grow your wealth, contact Laurium Capital at <strong><a href=\"mailto:ir@lauriumcapital.com?utm_source=BusinessTech&amp;utm_medium=Article&amp;utm_term=November+2025\" target=\"_blank\" rel=\"noreferrer noopener\">ir@lauriumcapital.com<\/a><\/strong> or visit <strong><a href=\"http:\/\/www.lauriumcapital.com\/?utm_source=BusinessTech&amp;utm_medium=Article&amp;utm_term=November+2025\" target=\"_blank\" rel=\"noreferrer noopener\">www.lauriumcapital.com<\/a><\/strong>.<\/p>\n\n\n\n<p>Laurium is an authorised financial services provider (FSP 34142).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In a global investment environment defined by uncertainty, fluctuating rate cycles and uneven growth, South African markets have quietly delivered \u2013 and in many instances, outperformed. <\/p>\n","protected":false},"author":57,"featured_media":843747,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10459],"tags":[22137,6951,19603],"class_list":["post-843743","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-news","tag-equities","tag-investment-firm","tag-laurium-capital"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/843743","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/57"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=843743"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/843743\/revisions"}],"predecessor-version":[{"id":843750,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/843743\/revisions\/843750"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/843747"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=843743"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=843743"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=843743"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}