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By Daniel Wesonga, Senior Sales Manager at Pepperstone
JSE Starts Week Flat as Key Sectors Show Mixed Performance
South African equities opened the week with little movement, as the JSE FTSE All Share Index hovered near the 101,000-point mark. Early trading saw diverging sector performances, with producer manufacturing, distribution services, and financials leading gains, while utilities, electronic technology, communications, and industrial services underperformed.
U.S. Tariffs Threaten South African Exports & Jobs
The 30% tariffs imposed by the U.S. on South African exports are raising concerns over potential damage to key industries reliant on American markets. Analysts warn that the tariffs could hurt exports and lead to job losses, adding pressure to an already struggling economy.
SARB Cautiously Optimistic Amid External Pressures
The South African Reserve Bank (SARB) acknowledges that external challenges, including the U.S. tariffs, have dented growth forecasts slightly. However, the bank highlights resilience in trade ties with Europe, China, and regional partners as a buffer. SARB emphasizes that structural reforms and improved electricity supply are crucial for economic recovery.
Market Awaits Manufacturing Data Amid High Unemployment
Investors are eyeing June’s manufacturing production data, due later today, for signs of recovery after a recent rebound in industrial output. However, unemployment climbing to 32.9% in Q1 2024 continues to suppress consumer spending and confidence, keeping the outlook for domestic equities cautious.
