South African asset prices should perform "ok", but mainly because there are more negative peers to compare to – especially Turkey – emerging markets economist Peter Attard Montalto of Nomura said on Thursday.

"South Africa will see an overarching political narrative as the ANC moves to its elective conference in December and shocks within government can occur, Montalto said in a 2017 outlook for Eastern Europe, the Middle East and Africa (EEMEA).

"All this should keep growth weak, albeit slightly stronger than in 2016. We see this having little impact on the SA Reserve Bank (Sarb) unless the currency weakens, though downgrade risk will be an important secondary narrative."

In his view, 2017 could be "a year of two halves". Turkey could be "noisy and negative" in the first half with South Africa quiet.

"The reverse could be the case in the second half of 2017, as Turkey passes the constitutional hurdle and South African politics heat up without much growth," said Montalto.

"We view EEMEA as an asset class likely outperforming Latin America or Asia given lower degrees of connectivity to US rate hikes or Trump policy, including protectionism. However, the region and especially its higher beta markets like Turkey and South Africa to a lesser degree, should drive quite differentiated returns within global emerging markets benchmarks – as quantative easing flow-related support from the Federal Reserve and the European Central Bank ceases and reverses."

According to Montalto countries that offer yield and are "quiet" on the narrative front may outperform. This would include South Africa and Russia in the first half of the New Year.

"However, shocks and a focus on idiosyncratics can then mean gains are quickly given back. Overall, it looks like a volatile year to come," said Montalto.

"While it is difficult to find region-wide domestic themes for 2017, we see a challenging external environment from the Trump Presidency and related policy changes. We see higher US rates, and to a lesser degree the eurozone and its monetary policy and politics, sharply magnifying domestic issues in EEMEA countries."