In today's Taking Stock, Under Armour shares dropped c.20% after it warned of worsening sales declines and flagged an additional $100m in annual tariff-related costs.
South Africa
The Top 40 index added 0.2% on Friday to close the week at 93,492.9 points, while the All Share index posted a 0.21% gain to settle at 100,855.2 points. South Africa's Reserve Bank anticipates only a marginal impact on GDP growth from the newly imposed 30% U.S. tariffs, with inflation largely unaffected. Although the U.S. comprised 7% of SA’s exports in June—well below China and Germany—the missed trade deadline with Washington has triggered the steepest tariff rate in Sub-Saharan Africa. The central bank has trimmed its 2025 growth forecast by just 0.1 percentage points. Meanwhile, Eskom reports diesel expenditure of R5.84bn over four months to sustain OCGT operations—almost half of last year's total spend—amid ongoing energy insecurity. Key economic data this week includes manufacturing, mining, unemployment, and retail sales.
Europe
European equities notched their strongest week in three months, with the STOXX 600 gaining 2.2%, led by a 1.9% rally in eurozone banks—now up 56.8% YTD. Investor sentiment was buoyed by prospects of a Russia-Ukraine ceasefire. UK labour market data added downside risks, as hiring intentions dropped to COVID-era lows, and wage growth slowed. Only 57% of UK private sector firms plan to hire in the next quarter. Meanwhile, Norway’s $2 trillion sovereign wealth fund is reviewing its Israeli holdings over ethical concerns, although officials confirmed no blanket divestment. An update is expected Tuesday, following scrutiny tied to the Gaza conflict.
United States
U.S. equities ended the week on a strong note, with the Nasdaq recording its second consecutive record close—up 3.9% for the week—driven by tech gains, particularly Apple’s 13.3% surge. The S&P 500 rose 2.4% and the Dow gained 1.3%. Investors are now eyeing Tuesday’s CPI release, which could challenge market optimism surrounding Fed rate cuts. Concerns also mount over U.S.-India trade tensions, as New Delhi pauses new defence purchases after Trump increased tariffs on Indian exports to 50%. Expedia shares gained 4.1% after raising full-year forecasts. Equities may face a near-term pullback pending inflation clarity and further geopolitical developments.
Asia
Asian equities edged higher as robust tech earnings supported elevated valuations. Japanese markets were closed, though futures indicate a possible test of record highs near 42,426. In China, deflationary pressure persists, with July producer prices declining more than forecast and consumer prices stagnating, reflecting muted domestic demand and lingering trade uncertainties. Factory-gate deflation has now extended over two years, with recent efforts to mitigate competitive pricing yet to yield meaningful results. Markets await U.S. inflation data this week, which could set the tone for dollar strength and Treasury yields, adding cross-market implications for Asia’s growth-sensitive sectors and capital flows.
Currencies
The South African rand remained stable following confirmation of a phone call between Presidents Ramaphosa and Trump regarding bilateral trade, ahead of further negotiations. The 30% U.S. tariff on South African imports remains the highest in Sub-Saharan Africa. The U.S. dollar was also steady on Monday after last week’s losses, with traders awaiting Tuesday’s CPI data. The dollar index held at 98.25. Against the yen, the dollar traded flat at 147.685 with Japanese markets closed. Currency markets remain highly sensitive to developments in U.S. trade relations and inflation expectations, which are likely to shape near-term central bank policy outlooks.
Commodities
Oil prices extended last week's 4% decline in early Asian trading amid rising expectations of a U.S.-Russia ceasefire deal and increased OPEC output. Markets are pricing in the possibility of lifted sanctions on Russian oil ahead of Trump’s planned meeting with Putin on 15 August in Alaska. The potential for supply normalisation continues to weigh on crude prices. Meanwhile, gold slipped as easing geopolitical tensions dampened safe-haven demand. Attention now shifts to this week’s U.S. CPI print, which could influence Federal Reserve policy expectations and, in turn, affect broader commodity market positioning and inflation-hedging strategies.
MAS Plc (MSP) +0.63%
Prime Kapital, as General Partner of the DJV, has launched an unregulated voluntary offer to acquire MAS shares at €1.40 per share or via PKI preference shares. The bid complies with DJV governance rules and the Investment Mandate, requiring no MAS or MAS CEE consent. Funding is sourced from new debt secured against DJV-developed assets, without breaching LTV limits. MAS confirms the bid does not trigger restricted matters, nor does it obligate DJV to redeem MAS’s preferred equity. The offer closes 14 August 2025. MAS shares are listed on the JSE but not subject to Maltese or South African takeover regulations.
Accelerate Property Fund Limited (APF) -4.44%
Accelerate Property Fund reported a challenging financial year amid South Africa’s infrastructure constraints, rising public debt, and strained US trade relations. Despite macro headwinds, a Government of National Unity has boosted investor sentiment, with GDP growth forecast at 1.5% for 2025. The Fund focused on deleveraging, disposing of eight assets for R694m, and achieving a 98.9% rent collection rate. A related party debt impairment of R970.7m materially impacted results, while rental income declined due to asset sales and reversions at Fourways Mall. Finance costs fell 34.1%, supported by R2.7bn in swaps. Portfolio vacancies improved to 19.4%, with ongoing capital reinvestment underway.
Thungela Resources Limited (TGA) -3.34%
Thungela Resources expects a sharp year-on-year decline in earnings for H1 2025, with EPS and HEPS projected between R1.40 and R2.10—down over 78% from R9.52 in H1 2024. Attributable profit is estimated between R180m and R280m, significantly impacted by weaker market conditions and R285m in restructuring costs as the Goedehoop and Isibonelo mines near closure. The result reflects sector-wide margin pressures and transitional asset closures. Final EPS and HEPS outcomes remain subject to judgement adjustments. Full interim results will be released on 18 August 2025. Investors should monitor forward guidance closely amid continued volatility in the coal export environment.
Nvidia Corporation (NVDA) +1.09% and Advanced Micro Devices Inc. (AMD) +0.21%
Nvidia and AMD have reportedly agreed to remit 15% of China-derived revenues from AI chip sales, such as Nvidia’s H20, to the U.S. government, according to officials. The move follows the Trump administration’s earlier export ban, partially lifted in July, with licenses now being issued for resumed shipments. China remains a critical market, generating $17bn (13% of sales) for Nvidia and $6.2bn (24%) for AMD in FY2024. While Nvidia stated it complies with all U.S. trade rules, AMD declined to comment. The arrangement may temper geopolitical risk for both firms but also introduces a new structural cost to China-facing chip sales.
Under Armour Inc. (UAA) -18.07%
Under Armour shares dropped c.20% after it warned of worsening sales declines and flagged an additional $100m in annual tariff-related costs. The sportswear group now expects gross margin to compress by up to 360bps in the current quarter, citing supply chain disruptions from U.S. tariffs—20% on Vietnamese and 19% on Indonesian imports. Roughly 45% of its goods are sourced from these regions. Q1 revenue fell 4% to $1.13bn, while EPS missed at $0.02. Founder Kevin Plank's return as CEO has yet to revive momentum amid weak demand and unpredictable trade policy under Trump. Q2 revenue is forecast to decline 6–7%.
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