Alibaba Hong Kong Shares Jump 19% on Strong Cloud Growth and AI Chip News

South Africa

The JSE Top 40 gained 0.09% to 94,271.4 points on Monday, while the All Share added 0.06%, ending at 101,899.0 points. However, sentiment weakened as Absa’s seasonally adjusted PMI fell back into contraction at 49.5 in August from 50.8 in July, with new sales orders sliding sharply amid tariff pressure. Washington’s recent 30% levy on South African exports threatens jobs in autos and agriculture, exacerbating weak demand. Agriculture sentiment also deteriorated, with Agbiz citing foot-and-mouth disease, trade friction, poor municipal service delivery and stalled land reforms as major headwinds.

Europe

European equities edged higher, with the STOXX 600 up 0.17% to 551.07, led by defence stocks after EU plans for post-conflict security support for Ukraine. Rolls-Royce, Rheinmetall and Hensoldt gained between 2.8% and 4.5%. Novo Nordisk advanced 1.8% after real-world data showed Wegovy significantly outperformed Eli Lilly’s rivals in reducing cardiovascular risks. Gains were capped by rising eurozone bond yields as fiscal concerns weighed. On the macro side, eurozone manufacturing expanded in August for the first time since mid-2022, supported by robust domestic demand. Investors now look to US jobs data for Fed policy signals.

United States

US equity and bond markets were closed on Monday for the Labor Day holiday.

Asia

Asian markets were mixed as investors monitored geopolitical risks and tariff developments. Japan’s central bank signalled gradual rate hikes but stressed caution amid global uncertainty. India posted a narrower Q1 current account deficit at $2.4bn (0.2% of GDP), reflecting external stability. Hong Kong retail sales rose 1.8% year-on-year in July, the third consecutive monthly gain. Meanwhile, BYD’s production fell 3.8% in August, its second monthly decline and first consecutive contraction since 2020, signalling a potential slowdown after years of rapid EV expansion.

Commodities

Gold extended its rally to a sixth session, reaching record highs on dollar weakness and expectations of a September Fed rate cut. Oil also climbed as Ukrainian drone strikes disrupted 17% of Russia’s refining capacity, heightening supply risks. Meanwhile, India’s clean power generation surged 20% this year, hitting record levels and on track to cover a third of utility output. The growth, driven by renewables, hydro and nuclear, is enabling reduced fossil-fuel reliance and easing import dependency, improving the outlook for the country’s energy trade balance.

 Currencies

The rand firmed alongside gold, supported by a weaker US dollar, which has lost ground on concerns over political pressure on the Federal Reserve. The dollar index edged up 0.1% to 97.709 in Asian trade, but remains near its weakest since late July after five sessions of selling. Traders shifted into havens such as gold, wary of President Trump’s escalating criticism of the Fed and his removal of Governor Lisa Cook. The perceived erosion of central bank independence has added to uncertainty over forthcoming policy moves.

Santam Limited (SNT) -0.11%

Santam delivered a strong interim performance for the six months to 30 June 2025, with group insurance revenue rising 12% to R27.5bn and basic and headline EPS both up around 19%. The underwriting margin expanded sharply to 11.3% (June 2024: 6.5%), supported by benign loss experience and improved portfolio quality. The Alternative Risk Transfer unit delivered a 28% profit uplift, while international operations benefited from double-digit growth at Shriram General Insurance. The board declared a 10% higher interim dividend of 590 cents per share.

Bidvest Group Limited (BVT) -5.91%

Bidvest reported resilient results for FY2025, with revenue up 5% to R126.6bn and trading profit flat at R12.0bn, reflecting margin pressure in Freight (-10%) and Commercial Products (-28%), offset by strong growth in Services SA (+14%), Services International (+12%) and Branded Products (+8%). Cash generation was a standout, rising 6% to R14.7bn with a 95% conversion ratio, underscoring balance sheet strength. Group HEPS fell 2% to 1,870.8 cents, while normalised HEPS held broadly steady. A final dividend of 453 cents per share was declared, up 1%.

CA Sales Holdings (CAA) 0.00%

CA&S delivered solid interim results for the six months to 30 June 2025, with revenue up 4% to R5.96bn, supported by organic growth, acquisitions and regional expansion. Operating profit rose 10% to R335m, while headline earnings climbed 17% to R242m, lifting HEPS 16% to 50.44 cents. EPS increased 15% to 50.72 cents. The balance sheet strengthened, with total assets up 16% to R5.85bn on expanded warehousing and new investments. No interim dividend was declared, consistent with the annual payout policy. Outlook remains positive across Southern and East Africa.

Sun International Limited (SUI) +1.67%

Sun International expects a strong first-half showing to 30 June 2025, with headline EPS set to rise 57–62% to 298–307 cents and adjusted HEPS up 6–7% to 227–231 cents. Basic EPS is, however, projected to fall 8–11% to 300–310 cents, largely reflecting revaluations linked to Dreams S.A. The group continues to strengthen its balance sheet, reducing debt to R5.0bn and maintaining leverage at 1.5x adjusted EBITDA with interest cover of 6.8x. Interim results will be published on 8 September 2025.

Bell Equipment Limited (BEL) -4.22%

Bell Equipment expects interim earnings and headline EPS for the six months to 30 June 2025 to decline 22–32% to 220–250 cents, from 322 and 321 cents respectively in the prior year. The weaker performance reflects a slowdown in global demand and the adverse impact of US tariffs, which are expected to weigh more heavily in the second half. Despite these pressures, the company notes that tariff effects in H1 were less severe than initially anticipated. Results will be released on 5 September 2025.

Blue Label Telecoms Limited (BLU) +3.81%

Blue Label has entered into a binding implementation agreement for a pre-listing restructuring of Cell C, designed to optimise its balance sheet ahead of a potential JSE listing. The restructure involves converting R3.7bn of TPC claims into equity, transferring CEC shares worth R2.15bn and airtime valued at up to R7.5bn to Cell C in exchange for equity, and acquiring Cell C shares from SPVs in settlement of debt. A share “flip-up” into Cell C ListCo and a new management incentive scheme are also planned. The listing remains subject to approvals and market conditions.

Alibaba Group Holding Limited (9988) +18.50%

Alibaba’s Hong Kong shares surged over 19% on Monday, reaching their highest level since March, fuelled by strong cloud computing results and news of a new AI chip in development. The rally followed Friday’s US earnings-driven jump of nearly 13%. While June-quarter revenue rose just 2% year-on-year to RMB247.65bn, below forecasts, net income surged 78%, ahead of expectations. Cloud revenue grew 26%, accelerating from prior quarters, with AI-related products delivering triple-digit growth for an eighth consecutive quarter. Investors view the division as central to Alibaba’s AI monetisation strategy. Meanwhile, its core e-commerce business is reviving, though investment in ultra-competitive “instant commerce” has weighed on margins, with investors tolerating near-term pressure in favour of long-term growth.

Do you prefer a full in-depth report you can read offline? Click here to download the full report.