The global markets have shown signs of increased stabilization in September. The global economic freefall that began with the collapse of Lehman Brothers in September 2008 has been restrained by the coordinated intervention of policymakers across the globe. While better than expected economic data and corporate earnings in September helped lift indices to new highs for the year, trading conditions remain volatile, as market participants reassessed the sustainability of the economic recovery and the prospect of earnings growth. Growing optimism about the economy prompted investors to sell the US dollar, the so called safe-haven, and snap up riskier assets and commodities. In September, foreign investors purchased a net R2,92 billion in local equities. This activity, coupled to US Dollar weakness, helped drive the rand to a new thirteen month high. The rand at these levels is now too strong to allow SA's export sector to take advantage of the subdued global recovery. The broader JSE fell 0,07% for the month, however the gold miners and industrials outperformed resources and financials. The gold mining index added 4,09% on the back of the gold price rising 5,92%. Financial markets are improving and capital markets are functioning closer to normality, however the pace of the recovery is likely to be slow going forward.

World markets recovered dramatically during March. Reports that US banks, which had led the collapse in the global economy, were returning to profitability (admittedly with the help of government bail out packages) fuelled the rally in share prices. American markets recorded their best ever monthly increase in over seventy years. The firmer trend was reinforced by views that the pace of the economic downturn was slowing and the worst of the recession may have passed. Resource prices hardened on the assumption that China's aggressive stimulus packages would lift demand for materials and that world trade would pick up in the year ahead, albeit from very low levels. Back home the JSE's overall index advanced 10% with Resources and Financials leading the way. Industrials lagged but still performed adequately aided by the prospect of further interest rate cuts. Notwithstanding the murky global economic outlook, glimmers of hope that business conditions are stabilizing should continue to attract investors out of safe haven assetss into equities. The TwentyTen Fund climbed 5.25% during March, underperforming gains in the broad market primarily because of the funds lower exposure to resources and financials. Although government infrastructure spending projects remain on course the growing risk of cancellation and postponement of projects in the private sector has impaired investor sentiment. Generally, though, the profitability of counters in the fund's portfolio remains satisfactory but share prices will be influenced by investor's discomfort over the health of the global economy.

Last year was one of the worst years in decades on world financial markets. Although the JSE touched an all-time peak in May, it declined rapidly in the second half of the year, closing down 26%. Troubles in the US subprime mortgage market that initially surfaced in 2007 escalated into a full blown financial crisis that ended up dragging the world economy into recession. Few economies were spared the sharp downturn, including fast growing emerging countries like China and India. The widespread slowdown in business activity triggered a sell-off in commodities (oil fell 70% from its high) and fuelled large withdrawals of funds from emerging markets. So far, the determined efforts of governments and central banks to increase liquidity and stimulate growth, through a series of stimulus packages totalling billions of dollars, have produced little meaningful change in confidence levels. Success of the authorities' measures will probably depend on creating stability in the housing and job markets. The TwentyTen recovered some ground in December but lost over 37% in calendar 2008, underperforming its benchmarks. The fund focuses on companies that will gain from growth in South Africa and its portfolio was hard hit by the foreign withdrawals on the JSE. Worries over the possible postponement of contracts and shrinking demand for infrastructure-related services put additional pressure on the fund. Notwithstanding the fall in share prices, the financial performances of the counters in the portfolio remain satisfactory.