Foreign investors sold R241m worth of local shares on a net basis last week, following a rocky 2016 during which SA’s net equity outflows hit a staggering R123.9bn. But the picture in the bond market was different, with foreigners picking up R230m worth of local bonds last week, according to the JSE data. Net bond inflows were R32.3bn over the past year. The bond inflows have supported the rand, which halted a five-year decline against the dollar in 2016, soothing inflation concerns. The rand has been relatively resilient in the face a strong dollar environment that has drawn strength from expectations of higher interest rates. "We consider local bonds to have an attractive risk/return profile against the backdrop of the on-going global carry trade and an improving envisaged domestic inflation and policy rate profile," said Herman van Papendorp, head of investment research and asset allocation at Momentum Investments in December. © Business Day
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