South African shares are about to round off their strongest quarter in almost two decades, and the influence of the coronavirus pandemic is clear to see in the shares most responsible for driving the market higher.
The FTSE/JSE Africa All Share Index has climbed 22% since the start of April, its best performance over any quarter since 2001.
Quite a few shares were at depressed levels, so there were a lot of opportunities there
“If the global economy continues to recover, combined with the money printing that is happening and with central banks cutting interest rates in most markets, there is a lot of stimulus that should support higher valuations,” said Peter Takaendesa, head of equities at Mergence Investment Managers in Cape Town.
It’s also been among stocks to benefit from buying by first-time mom-and-pop traders who, with an unprecedented amount of time on their hands during the national lockdown, were lured to the market by beaten-down valuations.
“We have seen an increase in appetite for stock broking type of accounts, where people have discretion to purchase shares like Sasol,” according to Renzi Thirumalai, head of investments at FNB Wealth Investments.
