JSE strikes gold 

The JSE All Share has had a good start to 2025, despite the impact of tariffs on global trade and investor sentiment, with the benchmark index up more than 10% since the beginning of the year. 

This is primarily due to the continued rise in the gold price, which has boosted the share prices of gold miners listed on the exchange. 

While the production of South Africa’s gold mining industry has plunged over the past twenty years, the JSE is still home to some major mining companies. 

This makes the exchange attractive to investors looking to cash in on the rise in the price of gold, Allan Gray’s chief investment officer, Duncan Artus, said. 

Artus was speaking at the asset manager’s The Times investment update, where he outlined some of the significant forces influencing markets currently. 

While much of the focus of markets has been on the impact of tariffs on financial markets, Artus reminded investors that they do not invest in presidents or governments or policies – they invest in companies. 

The focus must be on building a portfolio from the bottom up, with attention paid to how individual companies are performing in the current environment. 

In this regard, Artus said that many investors have been pumping money into gold by directly buying the metal or investing in gold mining companies. 

This has benefited the JSE, with the benchmark All Share Index appreciating by over 10% so far in 2025, thanks to the outperformance of gold mining companies. 

Crucially, this has also made the exchange relatively resilient amid the rapid change in US trade policy, with it dropping from 91,000 points to 78,000 and bouncing back to over 90,000 points in the space of two weeks. 

Artus said this may be somewhat surprising, considering that many shares are not near all-time high,s and so, questions are raised as to how the JSE is then hovering around its all-time high. 

He explained that the JSE has changed the index to move it away from being heavily weighted towards big multinational companies that do not really operate in South Africa, such as BHP and Richemont, towards local companies. 

This has resulted in South African banks being a significant part of the index, retailers playing a larger role, and now gold mining companies. 

While South Africa does not produce nearly as much gold as it once did, many miners are still listed on the JSE, including AngloGold Ashanti, GoldFields, DRD Gold, Harmony, and Pan African Resources. 

Some of these shares are now among the top six largest within the JSE All Share Index and, thanks to the rise in the price of gold, have pushed it towards new all-time highs. 

The rapid rise in the price of gold and the size of these companies in the All Share Index can be seen in the graph below, in comparison to their share of the Allan Gray Equity Fund. The second graph shows the performance of the JSE All Share Index so far in 2025. 

Gold’s record run

Gold prices have surged in recent years due to a combination of factors, including heightened global uncertainty and central bank purchases. 

“I think the big inflexion point was when the United States froze Russia’s reserves,” Artus said, referring to the start of the war in Ukraine and the sanctions placed on Russia. 

“Russia thought it had $300 billion in reserves, invested in US Treasuries and Eurobonds. The West said, ‘Thank you, you have invaded Ukraine and you do not have $300 billion anymore’.”

Artus explained that every other country in the world would have been taken aback by such an aggressive use of American soft power. 

As a result, many began trying to diversify their reserves out of US dollars and Treasuries and into gold and other stores of value. 

Central banks around the world began buying up gold, making a significant portion of their reserves gold and other neutral assets. 

“When everyone does this at the same time, you get a rapid appreciation in the price of gold, and this is set to continue,” Artus said. 

In the short term, gold’s sharp uptick has been driven by investors flocking to safe-haven assets after US President Donald Trump unveiled import tariffs into the United States.

Investors have piled into gold over the past few weeks, viewing it as one of the few assets shielded from the shocks to global trade. 

According to a recent Bank of America survey, 73% of respondents believe that the theme of “U.S. exceptionalism” has peaked, impacting markets. 

Nearly half of respondents now view “long gold” as the most crowded trade, overtaking bets on US tech giants for the first time in 24 months.

Gold has risen nearly 26% this year, buoyed by tariff disputes, strong central bank buying, expectations of interest rate cuts, and flows into bullion-backed exchange-traded funds.