JOHANNESBURG, April 20 – Ninety One Plc says recent market volatility linked to the Iran conflict has created attractive buying opportunities in South Africa’s equity market, with stock prices falling below what underlying earnings justify.
According to portfolio manager Hannes van den Berg, while mining shares have been hit by declining precious metal prices and broader emerging-market selloffs, corporate earnings expectations have remained relatively stable.
The FTSE JSE All Share Index has seen its forward earnings estimates decline only modestly since the start of the conflict, suggesting that fundamentals remain intact despite market weakness.
South Africa’s benchmark index is still down more than 5% since the onset of the war, reversing a strong rally that saw 12 consecutive months of gains through February. The mining sector, which carries significant weight in the index, has dropped sharply, reflecting declines in gold and platinum prices.
Despite this, Ninety One remains positive on key sectors including mining, banking and insurance, citing continued demand for critical minerals, supply constraints in commodities and long-term investment linked to artificial intelligence infrastructure.
The firm is more cautious on consumer-focused stocks, particularly discretionary retailers, which may face pressure from rising inflation and weaker economic conditions.
Investor sentiment appears to be shifting as well. A recent survey by Bank of America showed that a majority of fund managers now see more buying than selling opportunities in South African equities, with many viewing the market as undervalued.
Ninety One noted that geopolitical shocks often create pricing dislocations, presenting disciplined investors with opportunities to capitalize on mispriced assets while maintaining a focus on long-term fundamentals.
