Market Update: Bonds Cheer the Budget, Shares Mixed
South Africa’s Medium-Term Budget Policy Statement did what bond investors were hoping for: a firmer fiscal anchor, a buyback and lighter auction supply sent yields lower. The equity market, preoccupied with the global AI sell-off, oil and a weakening consumer, had a mixed reaction, with consumer shares taking a knock on lower growth expectations. The difference in the responses of bonds and equities is a reminder that a budget is a credit event before it is a growth event, whereas equities are more sensitive to the GDP growth outlook.
