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South African stocks are nearing the end of their best year since 2009, despite the fact that the gains have little to do with domestic factors. The FTSE/JSE Africa All Share Index fell 0.1 percent in the final session of 2021 on Friday, bringing its annual gain to 24 percent. On Wednesday and Thursday, the benchmark reached new highs.
While Covid-19 has harmed South Africa’s economy, the success of its stock market reflects optimism about a global recovery from the pandemic and increased demand for commodities. Anglo American and BHP Group, as well as Sasol, whose fortune is linked to oil prices, were major contributors to the gains, which are also the highest since 2009. Richemont, Johann Rupert’s luxury conglomerate, was the largest single driver of the South African gauge this year in terms of index points. The luxury retailer’s Johannesburg shares rose by a record 84 percent as the sector was buoyed by resilient pandemic sales and bullish prospects for 2022.
Because of the dominance of European-listed stocks such as Richemont, BHP, and Anglo American, the Johannesburg benchmark’s performance this year resembles that of major developed markets rather than that of emerging markets, with the MSCI EM Index down 4.5 percent.ArcelorMittal South Africa was the biggest local gainer, with a nearly ninefold increase in 2021. DRDGold, a gold producer, fared the worst, falling 27 percent.