In this edition of Lens on Markets, we look at how,
Market Commentary
South African Market Summary
South African equities advanced on Wednesday, with the JSE All Share and Top 40 indices each gaining 0.49% to 110,440.34 and 102,328.06 points, respectively. Sentiment was supported by Valterra Platinum’s sharply stronger interim performance, as higher platinum-group metal prices, production and sales volumes drove profit growth exceeding 1,600%. Domestic monetary indicators were softer, with M3 money-supply growth easing to 9.31% in June from 9.59% in May, while private-sector credit growth slowed to 7.80%, below expectations. Separately, Old Mutual’s 2026 Savings and Investments Monitor highlighted mounting household financial strain, reporting that 53% of surveyed workers use sports betting or online gambling to supplement income or service debt. The findings reinforce concerns around consumer vulnerability despite firmer equity-market performance.
European Market Summary
European equities weakened on Wednesday as mixed luxury-sector earnings and caution ahead of the Federal Reserve decision weighed on sentiment. The STOXX 600 declined 0.3% to 645.01 points, ending a three-session advance, while the luxury index fell 2.4%. Kering surged nearly 17%, its strongest one-day gain since 2002, after Gucci’s second-quarter sales declined less than expected. In the United Kingdom, investors anticipated the Bank of England would leave interest rates unchanged as policymakers assessed persistent inflation risks linked to the prolonged Strait of Hormuz disruption. Separately, UK vehicle production fell 7.5% during the first half of 2026 amid trade uncertainty, although the industry body indicated improving confidence under the new government.
US Market Summary
Wall Street declined sharply on Wednesday after the Federal Reserve held its benchmark rate at 3.50%–3.75%, while three policymakers dissented in favour of a 25-basis-point increase. The S&P 500 fell to a one-month low, and the Nasdaq Composite extended its retreat to roughly 9% below June’s record, with the Nasdaq 100 down 11% from its peak. Technology shares remained under pressure as investors questioned the scale of AI-related capital expenditure and its effect on free cash flow. Meta weakened in extended trading after raising the lower end of its 2026 capital expenditure guidance to US$130 billion. Despite solid earnings expectations, the S&P 500’s forward valuation of about 20 times earnings remains slightly above its ten-year average.
Asian Market Summary
Asian equities traded without clear direction on Thursday as investors assessed steep weekly losses linked to growing concerns over artificial-intelligence valuations and capital expenditure. The Federal Reserve’s divided decision to hold rates steady added uncertainty around the future path of US monetary policy and bond yields. In Japan, the government lowered its fiscal-year economic growth forecast to 0.9% from 1.3%, citing pressure from higher oil prices on household spending and corporate profitability. China’s commerce ministry threatened retaliation against the United States, alleging that the Federal Communications Commission had disregarded Beijing’s restraint on product restrictions. Separately, Australia’s internet regulator launched legal proceedings against Telegram over alleged failures to remove terrorist execution and mass-shooting content, adding to regulatory scrutiny across the region.
Currency Market Summary
The South African rand remained subdued as investors awaited clearer direction from the Federal Reserve and broader emerging-market currencies traded cautiously. The US dollar firmed modestly after policymakers left the benchmark rate unchanged, while Chair Kevin Warsh offered limited guidance on how divisions within the Federal Open Market Committee might influence future decisions. The dollar index rose 0.1% to 100.89, also supported by renewed US military action in Iran. Bond markets reacted sharply, with the 30-year Treasury yield climbing to its highest level in almost two decades. Interest-rate expectations shifted materially, as futures markets raised the probability of another hold at the September meeting to 42.6%, from 24% before the latest decision, reinforcing support for the greenback.
Commodity Market Summary
Gold edged higher on Thursday as investors assessed Federal Reserve Chair Kevin Warsh’s inflation commentary following the central bank’s decision to leave interest rates unchanged. Oil surrendered part of its earlier gains as tanker traffic continued despite escalating Middle East conflict. Shipping data showed 39 commodity vessels entered the Red Sea through the Bab el-Mandeb Strait on Tuesday, the highest number since 19 July, although Strait of Hormuz activity remained limited. Geopolitical risk stayed elevated after US-Saudi strikes targeted Iran-backed forces in Iraq, while Iran reported attacks on US bases and three tankers. Tehran rejected an Omani proposal for joint regional management of the Strait of Hormuz, while Saudi Arabia sought a coalition to protect Red Sea shipping from Houthi attacks.
Domestic Company News
Valterra Platinum Limited (VAL) +4.60%
Valterra Platinum delivered a sharply stronger first half, supported by higher PGM prices, increased production and improved cost control. Revenue rose 93% to R81.8 billion, while adjusted EBITDA increased more than fivefold to R33.4 billion and the mining EBITDA margin expanded to 50%. Headline earnings reached R82.02 per share, with free cash flow improving to R25.5 billion and net cash ending at R23.7 billion. The board declared a R57.00-per-share interim dividend, representing 70% of headline earnings. Metal-in-concentrate production increased 4% to 1.5 million ounces, while sales volumes advanced 18%. All-in sustaining costs declined 21% to US$996 per ounce. Management reaffirmed 2026 production guidance, although three fatalities and a higher injury-frequency rate remain material operational concerns for investors and management alike.
Glencore PLC (GLN) +2.59%
Glencore reported stronger first-half copper production and maintained full-year guidance for copper, zinc and nickel, signalling broadly stable operational delivery despite portfolio changes. Own-sourced copper output increased 15% to 397,000 tonnes, supported by higher African Copper mining rates and improved Antamina grades. However, cobalt production fell 46% amid the DRC export quota regime, while zinc declined 21% following Lady Loretta’s closure, lower Antamina grades and the Kidd disposal. Steelmaking coal output decreased 14%, although throughput and yields are expected to normalise during the second half. Management lifted the midpoint of energy coal guidance by one million tonnes and reduced steelmaking coal’s midpoint similarly. Marketing adjusted EBIT is expected at approximately US$3.3 billion, providing an important earnings contribution alongside industrial operations.
Shaftesbury Capital PLC (SHC) -0.59%
Shaftesbury Capital delivered stronger interim performance as leasing activity, rental growth and portfolio appreciation supported earnings and net asset value. EPRA NTA rose 3.9% to 223 pence per share, while the £5.6 billion portfolio increased 3.4% on a like-for-like basis. Underlying earnings advanced 8% to 2.4 pence per share, enabling a 16% increase in the interim dividend to 2.2 pence. The group completed 226 leasing transactions, securing £23.2 million of contracted rent at 18% above previous passing rents and 5% ahead of December 2025 estimated rental value. Occupancy remained high, with only 2.6% of ERV available to let. A 16% EPRA loan-to-value ratio and substantial liquidity provide capacity for portfolio investment, acquisitions and expansion opportunities across London’s prime West End.
ArcelorMittal South Africa Limited (ACL) -6.47%
ArcelorMittal South Africa expects its interim losses to widen materially for the six months ended 30 June 2026, signalling continued pressure on profitability. The company forecasts a loss per share of between R1.10 and R1.14, compared with an 84-cent loss previously, representing a deterioration of 31% to 36%. Headline loss per share is expected to increase to between R1.32 and R1.37 from 91 cents, a decline of 45% to 51%. The update indicates that underlying trading conditions remained challenging despite restructuring measures and operational interventions. Investors will focus on cash generation, liquidity, steel demand, pricing, import competition and progress on strategic funding discussions when reviewed interim results are released on 30 July 2026.
Global Company News
Microsoft Corporation (MSFT) -0.71%
Microsoft delivered a stronger-than-expected fiscal fourth quarter, reinforcing confidence that heavy artificial-intelligence investment is supporting growth. Revenue increased 18% to US$90 billion, while adjusted earnings of US$4.74 per share exceeded expectations. Azure revenue advanced 43%, ahead of consensus, and management forecast 45% constant-currency growth for the current quarter. First-quarter revenue guidance centred on US$90.4 billion, also above estimates. Cloud backlog reached US$678 billion, while paid Microsoft 365 Copilot seats surpassed 30 million. Free cash flow of US$19.6 billion beat forecasts despite declining 23% year on year. Reported capital expenditure guidance fell after a data-centre lease accounting change, although underlying spending plans remain unchanged. Investors welcomed evidence of improving AI monetisation, stronger cloud demand and continued cash generation.
Meta Platforms Inc. (META) -1.31%
Meta Platforms reported strong second-quarter revenue growth, but sharply weaker cash generation and higher AI expenditure unsettled investors. Revenue increased 28% to US$60.8 billion, supported by advertising demand and 3.6 billion daily active users. However, earnings of US$6.18 per share missed expectations, while free cash flow collapsed 91% to US$784 million as infrastructure spending accelerated. Meta raised the lower end of its 2026 capital expenditure guidance to US$130 billion, maintaining an upper limit of US$145 billion. Operating income fell 8%, reflecting legal charges and restructuring costs, although management indicated underlying growth excluding these items. Investors remain focused on whether Meta can monetise personal AI agents, diversify beyond advertising and manage substantial regulatory exposure while preserving returns and balance-sheet flexibility.
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Research Team