Download Weekly Note - 09 February 2026
Local Market Update:
Last week, South African data signalled tentative stabilisation. The Absa PMI rose to 48.7 and the S&P Global PMI reached 50.0, indicating firmer operating conditions despite weak exports. Vehicle sales increased solidly year on year. Trade diplomacy remained in focus, with progress on a China–Africa framework aimed at expanding duty-free export access. Nersa approved higher Eskom tariffs, lifting the medium-term cost outlook. Net foreign reserves improved to US$74.9 billion, while investors awaited further industrial output data for confirmation of momentum.
European Market Update:
European markets navigated a blend of improving activity data and cautious corporate signals. Germany’s manufacturing PMI rose to 49.1, suggesting stabilising industrial conditions, while euro area inflation moderated to 1.7%, with core easing to 2.2%. An ECB survey showed firms remained optimistic on revenues despite margin pressures. Policy attention centred on the European Central Bank’s steady stance and its move to expand euro liquidity access for foreign central banks. UK labour data showed firmer starting salaries and stabilising hiring trends, supporting wage resilience.
US Market Update:
US manufacturing returned to expansion in January, supporting cyclical sentiment, while the VIX eased, indicating calmer risk conditions. Softer ADP payroll growth and commentary from Federal Reserve officials reinforced the view that policy remains only moderately restrictive. Labour indicators pointed to cooling momentum, with higher jobless claims and softer job openings. Combined with elevated valuations and earnings uncertainty, these signals encouraged a more defensive market tone despite ongoing resilience in parts of the economy.
Asia Market Update:
Regional developments last week were driven by trade and monetary policy shifts. The US and India agreed on measures to ease tariffs and expand trade flows, improving visibility for exporters. The Reserve Bank of Australia raised rates to address persistent inflation, while South Korea’s inflation slowed to a five-month low. In Japan, Bank of Japan guidance sustained expectations of gradual tightening, and political continuity following Prime Minister Sanae Takaichi’s victory reinforced confidence in fiscal and policy stability.
Currency Market Update:
Currency markets reflected shifting macro expectations. The South African rand strengthened, supported by firmer precious metal prices, particularly gold and platinum. The Japanese yen rebounded following political clarity and expectations of supportive fiscal policy. Meanwhile, the US Dollar Index traded broadly sideways ahead of key economic releases. Futures markets modestly increased the probability of Federal Reserve rate cuts later this year, reflecting expectations of gradually cooling inflation and labour market conditions.
Commodity Market Update:
Oil prices softened as renewed diplomatic engagement between the US and Iran reduced immediate supply disruption concerns around the Strait of Hormuz. However, geopolitical risk premia remained elevated amid sanctions pressure on Russian exports and proposed EU restrictions on related maritime services. Shifts in Indian refining demand added uncertainty to trade flows. Gold advanced more than 1% over the week, supported by safe-haven demand as investors navigated geopolitical tensions and a less certain global growth outlook.