The market gained ground in February after a shaky start to the year in January. Despite the widespread concerns, selected shares and sectors have been very well supported, resulting in some big price gains. The rand strength relative to a vulnerable US dollar continues to be a major factor for the local economy and hence investment.

This article looks at global commodity prices, global interest rates, the US, Japanese and local equities.

Executive summary

The local market pushed up in February bringing the return for the first 2 months to 6,9% including dividends. The resource index has gained 16% while information technology fell back 2,7% and Financials up just 2,4%.

Last year companies were still looking to delist, but this trend has definitely slowed and in fact reversed. The local market has seen some large listings and the trend is likely to continue. A listing trend gives an indication of relative values between listed and unlisted businesses.

Commodities have continued to gain ground on very firm demand, mostly from Asia. I touch on this important trend in this report. The ongoing implication for investors is important.

Offshore markets ? Japanese companies continue to trade at attractive prices and for the longer term investor appears to be a better area to concentrate on. The US markets are currently at important levels. Having moved up firmly since 2002, the current mini bull in the greater US equity bear market is now either likely to run out of steam or move through strongly for a while ? we should know with more accuracy in the next couple of months.

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If you are looking for best advice investment counsel in 2005, I will be taking on selected high net worth clients. Contact me for a confidential discussion, or e-mail me your contact details to ian@exsequor.co.za

Posted: 2005/03/04 15:45 View Archive

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