By Zimele Mbanjwa
The FNB ETNs ended the quarter mostly higher as global equities delivered a positive fourth quarter. The quarter saw early strength supported by resilient economic data, improved sentiment and supportive central bank expectations, but this was countered somewhat amid a 43 day US government shutdown, sporadic AI valuation concerns and persistent geopolitical risks. The MSCI World Index gained 2.9%, with emerging markets outperforming (+4.3%) despite notable Chinese weakness. US equities rose steadily (S&P 500: +2.7%; Magnificent 7: +4.5%) as the Fed delivered a widely expected 25bps cut. Europe (Euro Stoxx 600: +6.1%) benefitted from firmer growth and anchored inflation, while the Bank of England cut rates to 3.75% and the European Central Bank held steady. Locally, South African markets benefitted from improved risk sentiment, the Financial Action Task Force (FATF) grey list removal, a ratings upgrade and stronger precious metals prices, which saw the JSE All Share Index end up 8.1% (+12.7% in USD). All the while, the rand made further gains against the greenback (+4.1%), thus resulting in the Quanto ETNs (without currency exposure) outperforming the Compo ETNs (with currency exposure).
The notable quarterly outperformers within the ETN basket were Eli Lilly (+49%) who benefitted from robust demand for its diabetes and obesity drugs, Zepbound and Mounjaro, while Alphabet rose 31% driven primarily by the breakout success of Gemini 3, its frontier AI model, as well as very strong cloud demand, all while a federal judge ruled that Google could retain control of Chrome and Android, eliminating the risk of a forced breakup. LVMH also had a strong quarter as modest, but consensus beating, sales figures reflected a sequential recovery across most business groups and geographies.
Notable losers were Netflix who fell 20% as a strong 3Q25 filing was dampened by a one-off $619 million charge related to a Brazilian tax dispute. Moreover, pressure on the streaming giant was driven by the Warner Bros deal related uncertainty. Paypal (-11%) also fell after announcing a strategic overhaul and downwardly revising its 4Q25 earnings guidance, against a backdrop of intensifying competition in the checkout market.
Ultimately, in rand terms, of the 32 FNB ETNs, 23 had a positive quarter, while nine ended in the red.
