Dear Reader,

Global equity markets for the most part continued their resurgence in June with a strong recovery, rebounding from the tariff-driven angst and geopolitical volatility arising from the conflicts between Israel/Iran and Russia/Ukraine, as well as the positive trade policy sentiment emerging from the US-China trade talks.

US markets had a strong month as the S&P 500 rose by 5.0%, the Dow Jones was up 4.3% and the Nasdaq being the best performer, rising by 6.6% for June. US first quarter GDP shrunk by 0.5%, with the tariff wars disrupting US business more than the previous estimate of 0.2%. The US Fed kept rates unchanged at its mid-June meeting, while lowering its growth outlook for 2025, as well as raising its inflation forecast.

European markets had a mixed June, impacted by trade tensions, geopolitical risks, and a mixed bag of economic data. Added to this, tariff uncertainty ahead of the 9 July deadline also tempered market expectations. The Dax declined by 0.4% for the month, while the CAC closed lower by 1.1%. Europe is seeing net negative earnings revisions. Credit growth remains subdued amid tighter financial conditions, weak capex, and cautious corporate investment behaviour, signalling a mid-to-late cycle environment.

The UK market ended the month unchanged from the previous month, while inflation in May slowed in line with expectations, printing at 3.4%, from the April reading of 3.5%, with core inflation at 3.5% in May compared to the April reading of 3.8%.

In Japan, the Nikkei ended the month higher by 6.6%, notwithstanding the continued concerns the negative impact the US tariffs might have on the Japanese economy. Japan’s 2025 real GDP growth is projected at 0.8%, slightly lower due to soft exports and subdued capital expenditure amid global trade uncertainty.

Asian markets had a strong June as Chinese stimulation efforts (better fiscal policies and monetary easing), aimed at boosting local demand and stabilising the under-pressure property market, impacted positively. The Hang Seng ended the month higher by 3.4%, while the Shanghai Composite ended firmer by 2.9%.

Our local market had a solid June, with the ALSI ending the month higher by 2.2%, with resources up 4.8%, the vanguard of the gains. This was followed by industrials, up 2.2%, financials, up 0.8%, though the property sector lagged the market, declining by 1.4% for the month. Selected top performing shares for the month were Telkom, up 38.6%, platinum share Tharisa (up 28.1%), Northam (up 26.6%), and Implats (up 23.1%) on the back of a platinum price that was stronger by 28.5% from the previous month. We also noted strength in We Buy Cars (up 21.9%), MAS PLC (up 20.7%), Sibanye Stillwater (up 17.7%), Ninety-One (up 13.8%).

Selected underperforming shares were KAP (lower by 19.0%) on the back of an earnings warning, Sappi (down by 13.8%), Woolworths (down 11.7%), DRD Gold (lower by 11.1%), and Burstone and Equites, lower by 10.5% and 9.3% respectively.