• Fluctuating Share Market: The first quarter of 2023 saw significant fluctuations in South Africa’s share market. The value and volume of shares traded increased from January to March, but experienced a notable drop in April.
• Non-Resident Transactions: Non-resident transactions, including net purchases of shares and bonds, varied significantly. There was a trend of net sales in shares from January to March, which reversed in April. The net purchases of bonds saw a similar reversal in February and March, but bounced back in April.
• Fixed-Interest Securities and Equity Derivatives: The fixed-interest securities market saw a significant surge in net issues of marketable debt securities in March and April. The equity derivative market experienced a peak in the number of deals and contracts in March, followed by a decrease in April.

In the first four months of 2023, South Africa’s capital market experienced a series of fluctuations, with notable shifts in the value and volume of shares traded, non-resident transactions, and the fixed-interest securities market. This article, inspired by the tone of Investopedia, will delve into the details of these changes, providing a comprehensive analysis of the market’s performance during this period.

Share Market Performance

In January, the value of shares traded was R427,666 million, which increased to R447,554 million in February, and further surged to R616,496 million in March. However, there was a significant drop in April, with the value decreasing to R373,210 million. The number of shares traded followed a similar trend, with 5,454 million shares traded in January, 6,837 million in February, 8,438 million in March, and a drop to 5,073 million in April.

Non-Resident Transactions

Non-resident transactions, which include net purchases of shares and bonds, also experienced significant changes. In January, there was a net sale of shares amounting to R11,894 million, which decreased to R5,623 million in February, and further to R12,035 million in March. However, April saw a reversal of this trend, with a net purchase of shares amounting to R5,756 million. The net purchases of bonds followed a different trajectory, with R9,281 million in January, a net sale of R11,051 million in February, a further sale of R24,292 million in March, and a net purchase of R18,012 million in April.

Fixed-Interest Securities Market

The fixed-interest securities market, which includes net issues of marketable debt securities and the nominal value of bonds traded, also saw significant changes. In January, there were net issues of marketable debt securities amounting to R12,098 million, which decreased to a net sale of R7,482 million in February. However, March saw a significant surge, with net issues amounting to R73,110 million, followed by R58,298 million in April.

Equity Derivative Market – Futures

The equity derivative market also experienced fluctuations. The number of deals decreased from 266,197 in January to 258,053 in February, then surged to 474,788 in March, before dropping to 238,069 in April. The number of contracts followed a similar trend, with 2,343,103 contracts in January, 3,317,887 in February, a significant increase to 14,713,249 in March, and a decrease to 4,339,403 in April.

Conclusion

The first four months of 2023 were characterized by significant fluctuations in South Africa’s capital market. The share market, non-resident transactions, fixed-interest securities market, and equity derivative market all experienced varying degrees of change. These changes reflect the dynamic nature of the capital market and underscore the importance of continuous monitoring and analysis to understand market trends and make informed investment decisions.

Table 1: Share Market Performance (2023)

Table 2: Non-Resident Transactions (2023)

Table 3: Fixed-Interest Securities Market (2023)

Table 4: Equity Derivative Market – Futures (2023)

Sources: JSE, ZAR X, Cape Town Stock Exchange, A2X Markets, and Equity Express Securities Exchange.