In 2025 year-to-date, the Johannesburg Stock Exchange (JSE) Top 40 outperformed the Standard & Poor’s 500 (S&P 500) in rand terms.

The JSE Top 40 refers to the 40 biggest companies on the JSE by market capitalisation. It includes big international companies like BHP, Richemont, Prosus, and BAT.

The S&P 500, or Standard & Poor’s 500 Index, is a market-capitalisation-weighted index of 500 leading publicly traded companies in the United States.

The S&P 500 is heavily skewed towards the technology giants Nvidia, Microsoft, Apple, Alphabet (Google), Amazon, and Meta.

Both the JSE and S&P 500 hit record highs this year. Last week, the JSE All Share Index (ALSI) broke through 100,000 points for the first time.

JSE CEO Leila Fourie said the recovery of the ALSI from 37,000 points in March 2020 to 100,000 points reflects the resilience and growth of South Africa’s capital markets.

She added that it marked 1,000% growth with annualised returns of over 11% since the JSE’s inception in 1960.

“This historic milestone bears testament to the operational excellence, collective resilience, and collaboration driving South Africa’s capital markets,” she said.

The S&P 500 has also recently reached a new all-time high of 6,395 points, indicating that the United States economy is in good health.

Morgan Stanley said the S&P 500’s strong performance is fundamentally justified, pointing to alignment between earnings beats and price momentum.

Many analysts remain bullish, predicting that the run will continue, with the S&P 500 reaching 7,000 points over the next year.

Others, however, see it as excessive Wall Street and investor euphoria with an inevitable decline set to follow.

Deutsche Bank analysts pointed to rising margin debt, the money investors borrow from brokers to buy stocks, which is a bad sign for the market.

“While there is still room for market euphoria to potentially grow, we are ultimately getting closer to that point where market euphoria is becoming too hot to handle,” they said.

JSE Top 40 versus S&P 500

With both the JSE Top 40 and S&P 500 reaching record highs, the question arises of which one provided the best returns to South African investors this year.

In 2025, the JSE Top 40 returned 20.46% in rand terms, well above the S&P’s 3.33%. This difference is partly driven by rand strength.

The US dollar weakened by 5.1 % against the rand. The exchange rate went from R18.71 per US dollar in January 2025 to R17.76 at the time of writing.

This means that if someone invested R100 in the JSE Top 40 index at the beginning of this year, they would have R120.46 in their account now.

If someone invested R100 into the S&P 500 at the beginning of the year, they would have R103.33 in their account.

The chart below shows the performance of the JSE Top 40 and S&P 500 for the year-to-date in rand terms.