Rand firmer as market remained volatile on Friday

The rand reversed the previous session’s losses as volatility persisted amid uncertainty surrounding the government of national unity (GNU) on Friday. The rand has gained nearly 3% so far in June, marking its best performance since December. After two weeks of intense negotiations and much anticipation, President Cyril Ramaphosa unveiled his new cabinet on Sunday night. The DA will lead six ministries and has also been allocated six deputy ministries. Ramaphosa announced that the deputy president will be Paul Mashatile, while DA leader John Steenhuisen has been appointed as the Minister of Agriculture.

European stocks ended a volatile session lower on Friday, marking their fourth consecutive decline, as investors exhibited cautious sentiment ahead of the upcoming French parliamentary elections and the Eurozone’s inflation data release next week. The Eurozone’s Stoxx 50 fell by 0.20% to 4 890, resulting in an almost 4% decline for the second quarter, while the pan-European Stoxx 600 dropped 0.20% to 511, showing little change since the end of March. This decline in equities occurred despite a favourable PCE price index report in the US.

Stocks in the US closed lower on the final trading session of June, as investors processed a range of economic data. The S&P 500 dropped 0.41% after reaching a new high of 5 500 points, while the Nasdaq declined 0.71% after briefly hitting a record level of 19 980. Meanwhile, the Dow Jones decreased by 0.12%. Recent data revealed that the Fed's preferred inflation measure remained nearly unchanged in May, potentially setting the stage for the Fed to lower interest rates later this year. “For the month, the S&P gained 2.90%, the Dow was up 0.70% and the Nasdaq rallied 4.90%. For the first half of 2024, the S&P added 15.10%, the Nasdaq 20%, the Dow gained 3.70%,” according to Trading Economics. Recent GDP figures from the US revealed that the economy expanded at an annualized rate of 1.40% in the first quarter of 2024, slightly up from the second estimate of 1.30%, yet continuing to reflect the slowest growth since the contraction observed in the first half of 2022.

The Hang Seng closed flat at 17 719 on Friday after initially trading modestly higher. Gains in financials, property, and consumer sectors balanced out losses in the tech sector. According to Bloomberg, some market participants viewed former President Donald Trump as the winner in the first US presidential debate.

In commodities, WTI crude futures fell by 0.20% to close at $81.54 per barrel on Friday, as investors considered weak US fuel demand and engaged in profit-taking at the end of the quarter.



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