AMD flags softer Q1 growth as Nvidia gap keeps investors cautious

South African Market Summary

South African equities advanced, with the FTSE/JSE All Share Index closing at 120,516.30 and the Top 40 at 112,442.17, both up 1.36%, supported by firmer resource prices. Southern Sun agreed to acquire a 50% stake in four Johannesburg properties from Liberty, signalling confidence in business-district hospitality demand. Mahindra South Africa endorsed SKD assembly as a pathway to localisation but criticised tariff loopholes. Diplomatic tensions with the US resurfaced, while S&P warned rising 2026 hard-currency debt repayments could heighten refinancing risk across African sovereigns.

European Market Summary

European equities reached fresh highs, though sector dispersion widened as sharp declines in technology and media shares offset gains in commodity and defence names. Investors reassessed software earnings durability amid accelerating AI-driven disruption. Defence stocks firmed on reports of expanded European military space investment. Asset manager Amundi posted stronger-than-expected inflows, supporting financials. Macro signals were mixed, with modest Russian growth projections contrasting with forecasts of rising UK unemployment, highlighting uneven regional momentum and reinforcing selectivity across sectors.

US Market Summary

US equities fell as investors rotated away from high-multiple AI beneficiaries, pressuring major technology shares ahead of key earnings releases. Concerns centred on intensifying competition and the risk of margin compression across software and semiconductor segments. Healthcare stocks also weakened following cautious guidance from a leading obesity-drug producer. While aggregate earnings expectations remain solid, political uncertainty briefly disrupted economic data scheduling after a temporary federal shutdown. Markets continue balancing robust profit growth against valuation sensitivity in AI-remodelling sectors.

Asian Market Summary

Asian markets traded cautiously following US weakness, as investors weighed regional growth signals and regulatory developments. Japan’s services PMI accelerated to its fastest pace in nearly a year, supporting the strongest private-sector expansion in over two years and indicating resilient domestic demand. In Australia, regulators urged the rapidly expanding pension industry to strengthen technology and operational systems as assets scale sharply. The guidance underscores growing supervisory focus on financial infrastructure resilience as institutional capital pools deepen across the region.

Commodity Market Summary

Gold rallied strongly, extending gains as a softer US dollar and renewed safe-haven demand drove inflows. Oil prices advanced amid escalating geopolitical tensions involving Iran and increased security risks around the Strait of Hormuz, a vital corridor for global crude shipments. Additional support came from industry data indicating a sharp drawdown in US crude inventories. Supply-side uncertainty, alongside persistent geopolitical friction and demand resilience expectations, continues to underpin elevated volatility and a firm near-term pricing environment.

Currency Market Summary

Currency markets reflected shifting rate expectations and commodity dynamics. The rand strengthened alongside firmer resource prices, moving back below R16.00 per dollar. The yuan attracted strong inflows as external balances improved, though authorities may resist excessive appreciation. The US dollar remained broadly supported as markets assessed Federal Reserve leadership prospects and a steadier political backdrop. Meanwhile, the yen traded cautiously ahead of domestic political uncertainty, highlighting continued sensitivity to global yield differentials and policy outlooks.

Harmony Gold Mining Company Limited (HAR) +1.75%

Harmony expects a solid H1FY26, supported by higher gold prices and resilient free cash flow, with full-year production and cost guidance unchanged despite temporary operational disruptions at Hidden Valley and lower recoveries linked to metallurgical factors and a cyanide shortage. Integration of the CSA copper mine in Australia is progressing well, while development at Eva Copper advances with EPC mobilisation due next quarter. Management continues to optimise the balance sheet to fund growth and sustain shareholder returns, underpinned by improved safety, asset quality and margin performance.

Impala Platinum Holdings Limited (IMP) +5.07%

Implats expects a sharp interim earnings recovery, driven by significantly stronger US dollar PGM basket prices and solid operational delivery. Headline earnings and HEPS are forecast to rise by roughly fourfold year on year, with basic earnings showing a similar trajectory, marking a substantial rebound from a weak comparative base. The improvement reflects firmer pricing and stable production across the portfolio, while the weighted average share count edged lower. Results for the six months to December will be released in early March and remain subject to external audit review.

The Foschini Group Limited (TFG) -0.02%

TFG reported resilient trading momentum, with group sales rising mid-single digits year to date and modest growth in the third quarter despite a constrained consumer backdrop. Online sales remained a key driver, delivering strong double-digit growth and increasing their contribution to total retail turnover. Market share gains in homeware and furniture offset softer apparel conditions, while gross margin moderated due to elevated clearance activity. Recent trading into January showed stabilising trends, particularly in TFG Africa, where sales growth improved and gross margin began to normalise.

Datatec Limited (DTC) +1.16%

Datatec announced that its subsidiary Logicalis USA has acquired Maple Woods Enterprises, a long-standing security partner, to strengthen its managed security services capability. Maple Woods’ Overwatch platform adds advanced cybersecurity and compliance expertise, originally developed for the US defence sector, deepening Logicalis’ service offering and supporting expansion into targeted US industries. Management highlighted cybersecurity as a strategic growth priority, with the transaction enhancing recurring services capabilities. The acquisition became effective in early February and is not subject to shareholder approval, as it falls below JSE categorisation thresholds.

Hyprop Investments Limited (HYP) +3.50%

Hyprop reported solid operational momentum across its South African and Eastern European retail portfolios for the six months to December, with above-inflation growth in tenants’ turnover and trading density. South African centres benefited from resilient consumer demand and strong Black Friday activity, supporting improved trading metrics despite modest footfall growth. In Eastern Europe, turnover and density advanced steadily, reflecting prime asset positioning and healthy tenant demand, although footfall remained softer. Management highlighted the portfolio’s resilience and ongoing focus on optimising asset quality and regional exposure to drive sustainable, risk-adjusted returns.

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