Palantir Q4 beats on strong US government and AI demand

South African Market Summary

South African equities retreated, with the JSE All Share Index closing 0.95% lower at 118,902.86 and the Top 40 declining 1.16% to 110,928.39, as investors weighed mixed domestic signals. Manufacturing sentiment improved, with the Absa PMI rising to 48.7 in January from 40.5, pointing to stabilising activity despite weak export demand. New vehicle sales rose 7.5% year on year, slower than December’s pace. Corporate updates were firmer, with Pepkor Holdings reporting solid revenue growth and Shoprite Holdings providing positive earnings guidance, underscoring pockets of consumer resilience in a still-constrained environment.

European Market Summary

European equities advanced, with the STOXX 600 rising 1% to a record high as strength in financials and healthcare outweighed early commodity-driven volatility. Initial weakness linked to a sharp pullback in precious metals eased, allowing risk appetite to recover. Attention now turns to peak earnings season, with roughly a third of index constituents reporting this week. ECB survey data signalled continued revenue optimism among euro area firms despite margin pressure. Meanwhile, Germany’s manufacturing PMI improved to 49.1, indicating stabilising industrial momentum at the start of 2026.

US Market Summary

US equities advanced, with the S&P 500 closing higher on strength in semiconductors and AI-linked names, while the Russell 2000 outperformed with a gain of about 1%. Alphabet and Amazon rose ahead of earnings, underscoring continued investor focus on AI leadership. US manufacturing returned to expansion in January, supporting cyclical sentiment. The VIX eased to 16.5, signalling calmer risk perceptions. Energy stocks lagged as oil prices fell on signs of easing geopolitical tensions and ongoing US fiscal uncertainty.

Asian Market Summary

Asia-Pacific markets advanced after the United States and India agreed a trade deal that will reduce bilateral tariffs and increase Indian purchases of US goods, including crude oil, while curbing imports from Russia. The development lifted regional sentiment as investors assessed improving trade visibility. In Australia, the Reserve Bank raised its policy rate by 25 basis points to 3.85%, its first increase since November 2023, responding to persistent inflation pressures. Meanwhile, South Korea’s consumer inflation slowed to 2.0% year on year in January, a five-month low broadly aligned with expectations.

Currency Market Summary

The South African rand firmed on Monday, recovering some losses after a sharp prior-session decline amid broader volatility across emerging-market and commodity-linked currencies. The dollar remained supported as upbeat U.S. economic data and shifting Federal Reserve expectations offset concerns about a potential government shutdown. The Australian dollar strengthened following an expected Reserve Bank of Australia rate hike, while the yen stayed weaker ahead of Japan’s election. The greenback also drew support from improving U.S. manufacturing data, easing geopolitical tensions tied to India and Iran, and delayed U.S. labour market releases.

Commodity Market Summary

Oil prices steadied after a sharp prior-session drop as markets weighed signs of potential de-escalation in U.S.–Iran tensions against a firmer dollar. President Donald Trump said Iran was “seriously talking” with Washington, with nuclear talks expected to resume in Turkey, while warning of risks if negotiations fail. India is slowing Russian crude purchases and may increase imports from the U.S. and Venezuela. OPEC+ kept March output unchanged, following earlier quota increases. Precious metals rebounded after a selloff linked to Fed leadership developments and higher margin requirements.

Shoprite Holdings Limited (SHP) -0.47%

Shoprite reported a resilient first-half performance, with continuing-operations sales rising 7.2% to R136.8 billion, led by Supermarkets RSA (+7.1%) and strong momentum in Non-RSA operations (+12.1% reported). Growth was volume-led as internal price inflation averaged just 0.7% versus national food inflation of 4.7%, supporting market share gains. Checkers and Sixty60 digital sales remained standout contributors, while adjacent formats expanded rapidly. The group added net new stores and expects interim HEPS growth of 5–10%. Proceeds from selected furniture disposals strengthened liquidity, reinforcing strategic focus on core food retail.

Sanlam Limited (SLM) +3.36%

Sanlam confirmed completion of the South African leg of its strategic transaction with Ninety One, following fulfilment of all suspensive conditions. This final step implements the long-term active asset management partnership first announced in 2024, complementing the UK transaction completed in June 2025. Post-closing, the Sanlam Group holds an effective 12.5% equity stake in Ninety One on a dual-listed company basis, or approximately 9.1% on an economic-interest basis excluding minorities. The deal strengthens Sanlam’s asset-management exposure, deepens strategic alignment and enhances long-term earnings diversification.

Pepkor Holdings Limited (PPH) +2.49%

Pepkor delivered solid first-quarter growth, with continuing-operations revenue up 12.9% to R29.9 billion, or 8.3% excluding acquisitions. Sales momentum was supported by resilient clothing and general merchandise and improved performance in furniture, appliances and electronics. Like-for-like sales rose 3.0%, with market share gains in Southern Africa and strong constant-currency growth in Brazil and PEP Africa. Fintech revenue surged 25%, driven by financial services expansion and higher Flash throughput. Online sales jumped 27.9%. Management remains cautiously optimistic as consumer conditions stabilise and recent acquisitions and fintech initiatives support medium-term growth.

Palantir Technologies (PLTR) +0.80%

Palantir reported robust fourth-quarter results, with revenue rising sharply to $1.41 billion, driven by a 66% surge in US government sales to $570 million. Management guided to continued acceleration, forecasting 2026 revenue above $7.18 billion and first-quarter sales ahead of consensus. CEO Alex Karp defended the firm’s surveillance technology, emphasising technical safeguards and audit controls amid political scrutiny of government data use. Commercial momentum also strengthened, with US business revenue expected to more than double next year, reinforcing Palantir’s positioning at the intersection of AI deployment and public-sector demand.

Walt Disney (DIS) -7.40%

The Walt Disney Company reported mixed fiscal first-quarter results, as softer international attendance at US parks and weaker entertainment profitability offset strong experiences and streaming momentum. Revenue rose 5% to $26 billion, ahead of expectations, while adjusted EPS declined 7% year on year. Parks, cruises and consumer products generated the bulk of operating income, whereas film and TV margins were pressured by elevated marketing costs. Streaming profitability improved sharply, and management reaffirmed double-digit full-year earnings growth, supported by robust cash flow and ongoing share repurchases.

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