The rand experienced its largest drop in over two weeks on Monday as investors awaited President Cyril Ramaphosa’s announcement of his new cabinet members. The ANC stated that Ramaphosa would reveal his new cabinet in the coming days following negotiations over positions with other political parties that have joined the government of national unity (GNU). The rand weakened to above R18/$ amid renewed dollar strength. The FTSE/JSE All Share Index rose by 0.62% to 80 263.14 points, and the Top 40 increased by 0.90%.
European markets started the week on a positive note and experienced significant gains on Monday, with the STOXX 50 increasing by approximately 1% as traders maintained a positive outlook despite political uncertainties in France. Germany’s DAX also rose by about 1% on as investors processed the latest economic data. The Ifo Business Climate index for Germany unexpectedly fell in June, supporting expectations for interest rate reductions.
China’s Hang Seng was muted on Monday, gains in financial stocks balanced out losses in the technology, consumer, and property sectors. Investors were closely watching for crucial economic data from the US this week, including PCE numbers, the Fed's preferred inflation indicators, and the final first-quarter GDP figures.
Wall Street traded in mixed fashion yesterday with the Dow Jones being the only index trading in the green, up 0.78% at 21h50 while the other two major indices lagged. The Dow’s run was a result of investors shifting away from AI-linked stocks and included some underperforming stocks in their portfolios, anticipating the US Federal Reserve interest rate cuts this year. Nvidia (NASDAQ:NVDA) declined for the third consecutive session, falling 5.40% as market analysts attributed the drop to profit-taking following its significant surge last week, which briefly made it the world's most valuable company. The most anticipated event for investors this week is Friday's Personal Consumption Expenditures (PCE) price index report, the Fed's preferred inflation measure, which is expected to indicate a moderation in price pressures.
In commodity markets, gold increased by 0.29% to $2 328.83/oz, platinum by 0.39% to $999.73/oz, and Brent crude was 0.75% higher at $85.89 a barrel.
