Monday, 12 December 2011 - 20:00
Average Monthly Equity Market Gains
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Looking back over an extended period of time, it is interesting to note the gains made by the local equity market on a month by month basis. We have analysed the month by month returns from the local equity market since 1970 and charted these monthly averages. The returns include dividends received – i.e. they are the total return from an investment tracking the JSE All Share index.
Firstly, given the general upward trend of the market over the long term, it is natural to find an average gain per month, with June being the lowest average at just 0.3%.
However what stands out is the average gain in each December month since 1970, which at 4.1% is far ahead of the next best month July at 2.5%.
Average monthly gains on the JSE per month from 1970:
We do know that averages can conceal a lot of variation and so looking back at the last 11 December periods, we find that only 2 out of the 11 periods produced a negative total return.
The highest gain in this time period was 11% in December 2001 – a year when the market as a whole produced a total return of 28.9%.
Gains on the JSE each December:
So the question is what is likely to happen in December 2011? Well, despite the history of generally positive performance in December, we would not want to infer too much from this.
For the year to date to the end of November the local equity market is up just over 5%, and over the last 12 months it is up 11.7%. Given that these returns are below the average annual return since 1960 of 19.4%, there is a possibility of a good end to the year.
On the other hand we have the world focusing on the European Union summit, which starts on Thursday night. The market is looking for a unified and positive outcome, but there remain many differences between the member countries as to the ideal policy and model. Watching very closely is the rating agency Standard and Poor, which has put 15 of the 17 euro countries onto credit watch negative, with a possible debt downgrade following this weekend.
The stakes are high. The market has been pushing the politicians to come up with credible solutions to the current treaty, which clearly has structural problems.
Because of the high correlations of global markets, a positive outcome over this coming weekend, together with the rating agencies holding back on any downgrades has a high probability of a rally in global equity markets to the end of the year.
Ian de Lange
021 9144 966
Mon, 12 Dec 2011
Zimbabwe's Mimosa mine, a joint venture between Impala Platinum and Aquarius, has given a 10 percent stake to locals, a government minister said on Monday, as it aims to meet a controversial law on local ownership.
South African stocks slid 1.4 percent on Monday, as a sharp decline in precious metal prices hit miners such as Gold Fields and Impala Platinum.
Prime Minister Adel Safar urged Syrians to vote in local elections on Monday to save the nation from "conspiracies against us" but activists struggling to oust President Bashar-al Assad rejected the ballot as irrelevant at a time of violent unrest.
Manuel Noriega, Panama's drug-running military dictator of the 1980s, was extradited back to the country on Sunday and taken straight to prison to serve a 20-year sentence for the murders of opponents during his rule.
Italy began a week of strikes by the three biggest labour unions against Prime Minister Mario Monti's 33-billion-euro austerity package, which the government may soften slightly to meet some of their demands.
World Markets (Spot Prices)
|JSE Top 40||17:00||28772.86||-396.75||-1.36%|
|JSE Indust 25||17:00||28759.22||-221.25||-0.76%|
|Rand / Dollar||19:59||8.2606||0.1592||1.97%|
|Rand / Pound||19:55||12.8560||0.2090||1.65%|
|Rand / Euro||19:55||10.9076||0.0836||0.77%|
|Rand / NZD||19:58||6.3024||0.0339||0.54%|
|Rand / AUD||19:55||8.3260||0.0623||0.75%|
|Yen / Dollar||19:59||77.8500||0.2320||0.30%|
|Euro / Dollar||19:55||0.7571||0.0089||1.19%|
|Dollar / Euro||19:59||1.3202||-0.0160||-1.20%|
|Pound / Dollar||19:55||0.6408||0.0018||0.28%|
Click here for the Sharenet Spot Price page
The JSE Today
|Index Name||RP||Move||% Move|
|Financial & Ind. 30||31,672.62||-274.54||-0.86%|
|Oil & Gas ||29,589.81||-165.75||-0.56%|
|Oil & Gas Producers ||15,909.89||-89.12||-0.56%|
|Basic Materials ||28,840.18||-587.94||-2.00%|
|Forestry & Paper ||11,842.40||-182.76||-1.52%|
|Industrial Metals ||29,071.45||-131.11||-0.45%|
|General Industrials ||80,098.96||-279.70||-0.35%|
|Consumer Goods ||29,336.51||-97.20||-0.33%|
|Automobiles & Parts ||4,300.21||-2.26||-0.05%|
|Health Care ||35,659.77||126.17||0.36%|
|Index Name||RP||Move||% Move|
|Food Producers ||53,759.60||-990.01||-1.81%|
|Personal Goods ||425.07||-6.60||-1.53%|
|Consumer Services ||57,091.93||-338.82||-0.59%|
|General Retailers ||48,791.30||-557.66||-1.13%|
|Travel & Leisure ||3,706.90||16.86||0.46%|
|Support Services ||2,172.55||67.41||3.20%|
|Non-life Insurance ||33,948.73||121.25||0.36%|
|Life Insurance ||16,622.63||1.02||0.01%|
|General Financial ||2,126.14||-35.42||-1.64%|
|SHARIAH TOP40 ||3,118.90||-56||-1.78%|
|FTSE/JSE SHARIAH ALL||3,183.71||-52||-1.61%|
|FTSE JSE Fledgling ||4,709.18||-8||-0.16%|
|FTSE/JSE Alt X ||1,217.64||-31||-2.50%|
|SA LISTED PROPERTY ||385.78||0.30%|
|CAPPED PROPERTY ||315.89||0.00%|
|FTSE/JSE RAFI 40||6,660.64||-86||-1.27%|
|Capped Top 40||15,138.63||-204||-1.33%|
|Capped All Share||16,307.62||-182||-1.10%|
Click here for the Sharenet Index Summary page
Latest Consensus Changes**
|APN||ASPEN PHARMACARE HLDGS||BUY||08 Dec|
|TSH||TSOGO SUN HOLDINGS LIMITE...||BUY||08 Dec|
|GRT||GROWTHPOINT PROPERTIES LI...||HOLD||08 Dec|
|SOL||SASOL LIMITED||BUY||08 Dec|
|ALT||ALLIED TECHNOLOGIES LIMIT...||HOLD||08 Dec||
|Expected||Company Name||Fin. Date|
|15 Dec 2011||RACEC||September 2011 (Final)|
|15 Dec 2011||TELEMASTR||September 2011 (Final)|
|21 Dec 2011||MARSHALL||September 2011 (Final)|
|21 Dec 2011||MARSHALL-||September 2011 (Final)|
|22 Dec 2011||JOHNDAN||September 2011 (Final)|
|NAMPAK 6.5||11-12-08||12-01-20||12-01-30||R 0.0650|
|NAMPAK 6%P||11-12-08||12-01-20||12-01-30||R 0.0600|
|ABIL PREF||11-11-21||11-12-08||11-12-19||R 3.1000|
|RAR||Rare Holdings Ltd||13/12/2011||Confirmed|
|RARP||Rare Holdings Ltd||13/12/2011||Confirmed|
|UBU||Ububele Holdings Ltd||14/12/2011||Confirmed|
|DNPP||Distribution and Warehousing Network Ltd||15/12/2011||Confirmed|
|ACT||AfroCentric Investment Corporation Ltd||15/12/2011||Unconfirmed||
Stock Exchange News Service
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