Global economic activity is slowing due to increased US tariffs and uncertainty surrounding generally chaotic and aggressive US foreign policy. Financial conditions, which tightened meaningfully in the immediate aftermath of the April US tariff announcements, have moderated due to a sharp rise in asset prices.
Erratic US government policy continues to result in subdued consumer and business sentiment in the US and reduced investment, although the decline in business investment has been less severe than expected due to resilient AI-driven spending. The US labour market is softening as companies delay hiring amid tariff uncertainty and AI-driven change, which is creating lower confidence, skill mismatches, and more cautious workforce planning. Consequently, US economic growth is beginning to weaken from a previously robust rate.
China’s nominal economic growth has been weak due to ongoing deflation and the consequences of a weak property market. The economy is now being further undermined by the escalating trade war with the US, which is expected to negatively impact Chinese exports and manufacturing. Positively, however, Chinese consumer confidence and spending may be improving from historically low levels, buoyed by more aggressive monetary and fiscal stimulus, and targeted structural state interventions that have had some success in improving local consumption.
The Japanese and European economies are being negatively affected by both the sharp increase in US tariffs and the continued uncertainty surrounding future tariff actions. There has been some front-loading of export activity ahead of tariff implementation, with underlying weakness now becoming more evident. Europe’s economy, which has been stagnating due in part to its export link to a weak manufacturing sector in China, will start to benefit from higher domestic fiscal stimulus. German business confidence, while having retreated recently, remains structurally higher due to the lifting of the debt ceiling and the associated increase in fiscal spending on infrastructure and defense.
South African activity has been supported by higher precious-metal export receipts and a mild recovery in real consumption as falling inflation and interest rates ease household pressure. Yet, a significant increase in online betting has diverted spending from other goods and services. A more enduring lift to economic growth is, however, structurally constrained by the acute underperformance of transport infrastructure, poor service delivery from weak and revenue-hungry municipalities, inadequate (albeit improved) electricity supply and low business confidence. Disappointingly, the recent moderate increase in investment off very low levels has not yet been accompanied by any notable job creation.
In recent years, there has been progress made in moving to reform the economy through Operation Vulindlela and the partnership between government and business leaders that is targeting key priority areas needing reform. Additionally, the Government of National Unity has brought about positive leadership changes in key ministries, and a renewed commitment by government to accelerate initiatives that address the country’s structural problems.
The Camissa Islamic Equity Fund was up 8.4% in the third quarter of 2025. It has returned 10.6% per annum over the last 10 years (versus 8.4% per annum for competitors). Since its inception in 2009, it has returned 11.0% yearly.
The Camissa Islamic Balanced Fund was up 6.1% in the third quarter. The fund has returned 9.1% over the last 10 years, ahead of the competitor average of 8.3%. Since its inception in 2011, the fund has delivered 8.2% per annum, well ahead of inflation.
Positive performances were delivered by all asset classes, particularly local and foreign equity. Locally, key positive contributors included PGM holdings, Omnia, Exxaro and MTN. Global equity contributed positively. We are substantially underweight in the US relative to our benchmark within global equities, and overweight in European and Japanese equities that are very attractively priced.
Currently, our portfolios have high exposure to platinum group metals (PGM) miners and other basic material companies together with a diverse range of other mispriced stocks, including an array of deeply discounted local mid-cap stocks. We also have a high exposure to longer duration government sukuks at present, which is offering very attractive inflation adjusted returns.
By: Camissa Asset Management investment team
Camissa Asset Management (Pty) Ltd is a licensed FSP.
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