The FTSE/JSE All Share Index dropped more than 1% on Friday, hitting a low not seen since mid-March and widening losses for the sixth consecutive session as investors remained concerned about the possibility of stricter monetary policies, while China’s economic slowdown spooked the rand.
Wall Street ended lower on Friday as concerns about longer-term interest rates and new credit issues in China caused the Dow Jones to end the day slightly higher, reversing losses from the previous four sessions. For the week, the Dow Jones lost 2%, the most since March 2023. The S&P 500 and Nasdaq dropped more than 2%, marking their worst week since February.
On Friday, European equities declined, compounding the week's losses as worries about the Federal Reserve's protracted aggressive monetary policy and increased credit risks in China grew. Mining stocks led a 0.60% decline in the benchmark STOXX 600 and the German DAX. In economic news, the annual consumer price inflation rate in the Eurozone came in at 5.30% in July 2023, the lowest level since January 2022, mainly as a result of a further drop in energy costs.
News that China’s Evergrande (HK:3333) filed for bankruptcy on Thursday caused Hong Kong's stocks to plunge by 2.05%, to conclude the week with a 5.90% loss. Since January 2023, the Hang Seng has fallen 20.90% year-to-date as China's slowing economic growth and worsening real estate crisis have drained investor confidence and fuelled symptoms of contagion. The Nikkei ended the week considerably lower as investors responded to data revealing that Japan's headline inflation rate exceeded projections in July 2023.
Brent crude oil traded around $84 per barrel at 18h00 on Friday. Oil prices were down more than 2% last week as signs of tightening global supply, concerns about a slowing Chinese economy and potential future interest rate hikes in the US influenced prices.
