In this edition of Lens on Markets,
Market Commentary
South African Market Summary
South African equities advanced on Friday, with the JSE All Share gaining 0.69% to 110,934.23 and the Top 40 rising 0.82% to 103,230.22. Investors now await Finance Minister Enoch Godongwana’s medium-term budget policy statement for guidance on fiscal consolidation and credit-rating prospects. The Reserve Bank aims to establish a cash-management utility by March next year, including its governance structure and directors, to support unbranded ATMs and improve access to cash. Meanwhile, government plans to phase out semi-knock-down vehicle assembly, withdraw policy support for new operations and strengthen definitions governing complete-knock-down manufacturing. Separately, the Supreme Court of Appeal immediately prohibited the Road Accident Fund from deducting compensation because claimants’ medical expenses were or would be covered by medical schemes, following an appeal by Discovery Health.
European Market Summary
European equities rose on Friday, with the STOXX 600 gaining 0.7% to 644.74 and advancing more than 2% over its strongest week since late June, as earnings cushioned technology-sector weakness. September’s final eurozone inflation reading was 3.8%, reinforcing expectations of a December rate increase after the ECB raised rates by 50 basis points this year to 2.50%. The IMF projected eurozone growth of 1.1% in 2026 and 1.2% in 2027, warning that stronger growth and reduced borrowing were essential for debt sustainability. Around three-quarters of European countries require reforms alongside fiscal consolidation averaging 3.5% of GDP, exceeding planned adjustments of approximately 2%. In France, President Emmanuel Macron appealed for calm following weekend unrest over high living costs and deteriorating public services.
US Market Summary
Wall Street declined on Friday as renewed selling in AI-related technology shares and higher oil prices unsettled investors. The Nasdaq was heading for a weekly loss exceeding 4%, reflecting concerns that indebted AI infrastructure companies might struggle to generate profits before repayments fall due as borrowing costs rise. Federal Reserve Chairman Kevin Warsh highlighted economic resilience but warned that an investment surge was adding near-term inflation pressure, reiterating the commitment to price stability following September’s rate increase. Meanwhile, US officials said a review of waived Russia-related sanctions and tariffs could take up to 60 days, leaving policy uncertain. Attention now turns to results from Tesla, Meta Platforms and Procter & Gamble, with analysts forecasting overall third-quarter earnings growth above 30%, led by AI-related megacaps.
Asian Market Summary
Asian equities declined on Monday as concerns over the substantial financing requirements of artificial intelligence investment weighed on sentiment ahead of a busy earnings week. Stronger Chinese growth provided some support, with third-quarter GDP expanding 4.5% year on year, above the 4.4% consensus forecast and the second quarter’s 4.3%. The improvement reduced pressure for more aggressive stimulus, although housing weakness persisted. New home prices fell 0.1% month on month in September, matching August’s decline and extending a period exceeding three years without monthly or annual growth. In Japan, Bank of Japan Governor Kazuo Ueda said underlying inflation was approaching the 2% target, citing tight labour conditions and strong global AI demand. Upcoming quarterly forecasts will be scrutinised for indications of the next interest-rate increase.
Currency Market Summary
The rand strengthened in early trading on Friday as the dollar weakened, with investors looking towards South Africa’s forthcoming medium-term budget for signals on fiscal policy and credit-rating prospects. By Monday’s Asian session, the dollar had steadied near its lowest levels of the month as unrest in France weighed on the euro. The single currency declined 0.1% to $1.1225, while the dollar index stood at 101.83. President Emmanuel Macron condemned weekend violence linked to protests over living costs, adding to uncertainty surrounding France. Offshore, the dollar was unchanged at 6.6842 yuan ahead of Chinese third-quarter GDP data, which was expected to show slightly stronger growth. Meanwhile, futures implied an 84% probability of unchanged Federal Reserve interest rates at its October meeting, broadly consistent with Friday’s pricing.
Commodity Market Summary
Gold edged higher on Monday as softer oil prices provided support, while investors assessed the prospect of a Federal Reserve rate increase later this year. Oil declined after President Donald Trump waived Russian sanctions and tariffs, potentially increasing fuel exports, although a review lasting up to 60 days leaves implementation uncertain. A separate diesel agreement envisages shipments of approximately 2.3 million barrels this month, rising to 7.6 million barrels monthly. Supply risks nevertheless remain elevated: Brent briefly reached $110 a barrel on Friday, while Kpler reported that Gulf crude flows fell to approximately 8.5 million barrels per day from more than 20 million the preceding week. Attacks on commercial vessels and Egypt’s offer to support Saudi Arabia against the Houthis underscored continuing regional risks.
Domestic Company News
Vodacom Group Limited (VOD) +0.94%
Vodacom’s acquisition of an effective 20% interest in Safaricom, comprising 15% from the Government of Kenya and 5% from Vodafone via Vodafone Kenya Limited (VKL), remains subject to appeal proceedings following completion on 30 June 2026. On 13 October 2026, Kenya’s Court of Appeal opted not to determine an application for a stay order, instead recording that the substantive appeal would be fast-tracked. The prevailing position regarding the shares and purchase consideration will remain unchanged pending the appeal hearing. VKL therefore remains the registered holder of the Safaricom shares acquired from the government, while the corresponding consideration must be preserved. Vodacom and other affected parties are appealing the High Court’s 15 September 2026 judgment. The group reiterated confidence in the acquisition’s strategic rationale.
TeleMasters Holdings Limited (TLM) 0.00%
TeleMasters reported revenue growth of 8.15% to R69,809,679 for the year ended 30 June 2026, while operating profit increased 269.33% to R4,085,825. Earnings per share rose 403.23% to 4.68 cents, and headline earnings per share advanced 334.26% to 4.69 cents. Net asset value per share increased 5.08% to 68.44 cents, while dividends paid per share rose 133.33% to 0.70 cents. The technology investment group operates through ICT solutions provider Catalytic Connections and Pretoria-based data centre Ultra DC. A gross cash dividend of 0.3 cents per share was declared from retained earnings, equivalent to 0.24 cents after withholding tax. The last trading day for eligibility is 2 November 2026, with shares trading ex-dividend on 3 November. The record date is 6 November, with payment on 9 November.
Insimbi Industrial Holdings Limited (ISB) 0.00%
Insimbi returned to profitability in its unreviewed results for the six months ended 31 August 2026, supported by higher commodity prices, streamlined operations and disciplined cost control. Revenue increased 16% to R3.204 billion, while operating profit rose 119% to R55.052 million. Net profit reached R15.247 million, compared with an R8.633 million loss. Headline earnings per share recovered to 4.58 cents from a 1.30-cent loss, while operating cash generation improved to R11.088 million from a R30.980 million outflow. Ferrous volumes increased 6.72%, although non-ferrous volumes remained steady amid tariff volatility and export-permit delays. The secondary aluminium smelter relocation was completed, with recommissioning expected in October 2026. Strong refractory performance provided an encouraging signal, but rising fuel and electricity costs continued to pressure margins.
Global Company News
ExxonMobil Holdings Corporation (XOM) +2.46%
ExxonMobil indicated that stronger third-quarter refining margins could increase downstream profit by $4.5 billion compared with the preceding quarter. Supply disruptions linked to the Iran war, restricted exports through the Strait of Hormuz and Ukrainian attacks on Russian refineries supported margins. BMO Capital Markets estimated that adjusted refining net income could reach $8.5 billion, more than double the previous quarter’s level. However, upstream earnings could decline by $1.3 billion as average Brent prices fell approximately 5.6% quarter on quarter. Upstream asset disposals are expected to add $700 million to earnings, while Exxon reported no war-related volume disruptions during the period. Higher fuel prices and substantial refining profits could intensify political scrutiny ahead of November’s US midterm elections. Full results are due on 30 October.
Microsoft Corporation (MSFT) -1.93%
Britain’s Competition and Markets Authority proposed granting Microsoft strategic market status in business software, potentially enabling restrictions on product bundling and licensing practices. The regulator identified strong market positions reinforced by switching barriers and will examine competition involving Copilot, security products and cloud services. Microsoft disputed the findings, highlighting product interoperability. A final designation decision is due by February. The CMA also urged Microsoft and Amazon Web Services to address remaining cloud-switching barriers. Separately, the Telegraph reported that Microsoft had withdrawn from Nscale’s Loughton data-centre project, where grid power reportedly may not be available until the 2030s. Microsoft declined to comment. Nscale said its other Microsoft contracts were unaffected and reaffirmed its commitment to the development, including exploring alternative power sources.
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Research Team