Download Weekly Note - 20 October 2025
Local Market Update:
Last week, South Africa’s economy showed cautious optimism as the IMF revised 2025 GDP growth to 3.2%, supported by stronger commodity exports and global demand. The rand strengthened amid rising gold prices, while treasury bill auctions indicated foreign investor confidence. Corporate earnings were mixed, with retail and mining sectors resilient but industrials lagging. Policymakers are exploring fiscal reforms and energy investments, and inflation remains within target, providing monetary flexibility. Trade challenges persist, particularly with tariffs on key exports, shaping investor sentiment and capital flows.
European Market Update:
European markets were volatile, with the STOXX 600 down 1.3%, influenced by U.S.-China trade tensions and mixed economic data. The euro weakened, while Brent crude declined on oversupply concerns. Bond yields fell as investors sought safety. Corporate earnings were uneven, with technology outperforming and industrials under pressure. Subdued growth prompted ECB attention on policy strategy. Capital inflows were cautious, reflecting geopolitical and trade uncertainties. Investors focused on sector-specific performance, currency movements, and potential fiscal or monetary interventions as risks persisted across regional markets.
US Market Update:
U.S. markets faced headwinds last week, with the S&P 500 declining due to escalating trade tensions with China. The Federal Reserve maintained a cautious stance on interest rates amid inflation concerns. Job growth slowed, and wage pressures persisted in certain sectors. Technology and renewable energy companies led corporate innovation, while healthcare costs and housing affordability attracted investor scrutiny. The U.S. dollar strengthened against major currencies, reflecting safe-haven demand. Fiscal policy debates, infrastructure spending, and upcoming economic data remain key focus areas for market participants.
Asia Market Update:
Asian markets were mixed, with Japan’s Nikkei up 2.9% following political stability, while China’s GDP growth slowed to 4.8% in Q3, highlighting domestic and trade challenges. The Indian rupee remained under pressure despite central bank intervention, while commodity-linked currencies like the Australian dollar gained amid improved risk sentiment. Technology sectors, particularly AI and 5G, experienced rapid investment growth. Volatility persisted across financial markets, and high youth unemployment and climate-related agricultural challenges shaped regional economic sentiment and investment flows, while RCEP-enhanced regional cooperation remained a focal point.
Currency Market Update:
Currency markets were shaped by risk sentiment and global developments. The U.S. dollar strengthened against the euro and yen, driven by safe-haven flows amid trade tensions. The Japanese yen weakened amid expectations of potential monetary stimulus, while the Indian rupee remained pressured despite intervention. Commodity-linked currencies, including the Australian dollar, gained with improved risk appetite. Emerging market currencies displayed mixed performance, reflecting varying domestic conditions and capital flows. Central bank actions, trade balances, and geopolitical events continued to influence volatility, guiding investor strategy in foreign exchange markets.
Commodity Market Update:
Commodities experienced mixed movements last week. Oil prices fell amid oversupply fears and geopolitical tensions, while gold remained elevated as a safe-haven asset. Base metals surged on industrial demand, and agricultural commodities fluctuated due to weather and trade dynamics. Supply chain disruptions affected pricing and availability across key sectors. Growing investment in renewable energy signalled shifts in the energy landscape, while stricter environmental regulations impacted production and trade strategies. Investors monitored these movements closely, balancing traditional and sustainable commodity exposure amid market uncertainty.