Global Equity markets, measured by the MSCI World Index, ended the 2 nd quarter 2004 marginally positive and delivered a return of 0.32% in USD terms.

The South African Rand delivered another strong performance and appreciated by more than 2% against the Dollar. At one stage during the quarter, the Rand was as low as R7.10 but strengthened to around R6.20/$ at quarter end. The Rand strength impacted negatively on investor performance numbers if measured in Rands.

Not many countries delivered positive returns over the quarter but Germany's Dax, the technology heavy Nasdaq and France did, with returns ranging between 1% and 5% in USD terms. After many strong quarters over the past 12 months, the Asian markets suffered with Japan loosing more than 3% and Korea, Taiwan and China loosing more than 10%.

Industries that performed really well included Leisure, Hotels and Airlines. Coming off a low base due to geo political risks and looking more stable going forward, these tourism related stocks performed well. Software stocks also rose and the higher oil price supported Oil and Gas companies (up around 8%). Some of the under performing sectors include Metals and Minerals, Technology Hardware and Specialist Financial Services companies. The Mining Index in Europe lost 7% in Euro terms over the quarter.

The MSCI World Index fell 0.66% in USD terms in March and regional returns varied widely, as the local returns for the Pacific, Europe, and North America were 5.9%, -2.3%, and -0.1%.

Economic data was mostly negative for the month as consumer confidence/investor optimism fell in Germany, France, and Italy, fewer jobs were added in the US than was expected, Japanese machinery orders fell sharply, and UK factory production rose less than expected. The US dollar continued its mixed performance in March as the yen reversed course and rose 5.0% versus the dollar.

The MSCI World Equity Index rose 6.27% in USD terms in December, finishing the year up 33.1%. The SA Rand appreciated by more than 20% against the US Dollar, resulting in substantially lower fund returns when measured in Rands.

Given both the strong euro and yen in December, regional returns in US dollars for Europe, North America, and the Pacific were 8.2%, 5.2%, and 6.9% respectively. The US dollar weakened again in December, hitting an all-time low versus the euro and an eleven-year low versus sterling in December.

Lower interest rates globally, improved economic growth prospects and the end to the Iraq war all contributed to improved market sentiment in the second half of 2003. The big winners included technology stocks, selective metals and minerals (gold) and cyclical companies (like semiconductors and construction firms). Under performing stocks included pharma and certain food companies.