August 2025

Global equity markets remained broadly positive in August. This occurs despite weaker-than-expected US job market figures, as well as a report released by the Massachusetts Institute of Technology (MIT) suggesting that artificial intelligence pilot programmes were not boosting corporate revenue growth. Due to a shift in economic risks, Fed Chairman Jerome Powell hinted at a policy change at the annual Jackson Hole meeting, making a September rate cut highly likely. Markets have largely begun to look beyond the current level of policy uncertainty, with the latest being the US proposing a 50% tariff on India in an effort to reduce its dependence on Russian oil and gas imports. The US and China extended their trade truce until 10 November, which benefited Chinese export firms. Chinese tech names were also boosted by the government announcing intentions to triple the chip supply in 2026.

South African equity markets again outperformed their emerging market counterparts for the fifth month this year, largely due to continued strong performance in the resources sector. The index reached new highs during the month and is now comfortably above the 100,000 level, which it so briefly touched last month. The July inflation print saw inflation rise to 3.5% (up from 3.0% in June), which was in line with market expectations.

• The JSE All Share had another strong positive month, up 3.5%.
• All three major sectors supported the bourse, as Industrials (up 1.1%), and Financials (up 0.8%) continued to grow, while Resources (up 11.4%) surged higher again.
• Small-caps (up 1.9%) and Large-caps (up 3.9%) boasted healthy returns, while Mid-caps (down 0.6%) contracted slightly.
• The South African property markets delivered another positive month for investors, as the ALPI added 2.8%, and the S&P SA REIT Index grew 2.2%.
• SA Nominal Bonds (up 0.7%) took a slight breather for the month. Inflation-Linked Bonds inched higher, up 1.7%, on the back of the month’s slightly higher inflation print.
• Developed market equities closed higher in US dollar terms, as the MSCI World Index rose 2.6%, outperforming the MSCI Emerging Market Index (up 1.5%) for only the third month this year.
• The rand had a strong month in terms of dollar relative performance. Relative to the U.S. Dollar (Rand appreciated 2.1%), the Euro (Rand depreciated 0.1%) and the Pound Sterling (Rand appreciated 0.1%).
• Resources had another strong month, as Gold (up 5.5%) and Platinum (up 6.2%) climbed higher. Brent Crude dropped 6.1% over the month, as supply increased.

Source: Factset