Fund manager Neptune said it is broadly positive on African equities and it expects Nigeria and Kenya to outperform South Africa in the short term.
Neptune African Fund manager, Shelley McKeaveney, commented: “Geographically, Nigeria represents the best opportunity, and we expect an outperformance of the Nigerian market in the second half of 2014, relative to the broader African market.” She added that the outperformance of the South African market has been led by blue chip stocks with globally-diversified earnings. “We continue to favour these types of stocks, given the tepid outlook for the domestic economy,” McKeaveney commented.
She added that Neptune is cautious on its outlook for the South African mining sector, as it faces structural challenges. It prefers globally diversified miners, as well as well as South African paper and agriculture stocks and Nigerian cement companies.