Download Weekly Note - 08 September 2025
Local Market Update:
ArcelorMittal South Africa’s potential retrenchment of over 4,000 workers signals deep structural pressures in the country’s industrial sector, underpinned by high costs and weak demand. Meanwhile, Shoprite posted a 15.8% rise in annual earnings, demonstrating strong consumer resilience and inflation control. However, the sugar industry faces dual threats from new U.S. tariffs and cheap imports, jeopardising a sector supporting 300,000 jobs. Investors should monitor labour unrest risks and inflationary dynamics within key consumer and export-facing industries.
European Market Update:
European bond markets experienced elevated volatility as UK gilt yields surged to 5.75%, their highest since 1998, before easing. Bank of England Governor Andrew Bailey attempted to assuage concerns, but rising fiscal risks and political uncertainty—particularly in France—kept investor sentiment cautious. Market participants remain focused on upcoming eurozone PMI and inflation data, while equity indices held relatively steady. Longer-dated sovereign debt across Europe may face sustained pressure as fiscal discipline debates intensify in the lead-up to year-end.
US Market Update:
U.S. equity markets rallied last week amid growing conviction that the Federal Reserve may begin easing rates following softer labour market data. Treasury yields declined to five-month lows, while safe-haven demand pushed gold near all-time highs. The broader bond market sell-off remains a key theme, however, as fiscal sustainability concerns persist. For fixed income and multi-asset managers, the evolving rate path, fiscal outlook, and inflation expectations warrant close scrutiny ahead of the next Fed policy meeting.
Asia Market Update:
Asia’s headlines were dominated by political and energy developments. Japan’s markets were unsettled following Prime Minister Shigeru Ishiba’s resignation, leading to a weaker yen and increased policy uncertainty. In contrast, China and Russia advanced energy cooperation, signing a 30-year pipeline deal to deliver 50 billion cubic metres of gas annually via Mongolia. The agreement underscores Beijing’s ongoing diversification strategy. Investors should watch yen volatility and geopolitical alignment across Asia, particularly as it influences energy markets and regional capital flows.
Currency Market Update:
The U.S. dollar weakened last week as markets priced in more dovish Fed expectations, lifting the euro and sterling. The yen, however, depreciated sharply following the resignation of Japan’s Prime Minister, exacerbating concerns over the country’s fiscal and monetary policy direction. Currency markets are increasingly reactive to political risk and interest rate differentials. Portfolio hedging strategies and FX exposures should be reassessed, particularly given the rising volatility and uncertainty across key developed and emerging market currencies.
Commodity Market Update:
Gold surged to near-record highs, buoyed by expectations of U.S. rate cuts and increased fiscal concerns globally. The metal approached $3,600/oz, reaffirming its safe-haven appeal in periods of monetary uncertainty. Oil prices edged higher, gaining approximately 1%, supported by cautious OPEC+ output management in the face of weakening global demand. Commodity-linked assets may remain sensitive to central bank signals and macroeconomic data surprises. Allocations in energy and precious metals should consider the broader macro backdrop and policy trajectory.