Samsung set for best quarter since 2022 on chip price surge, despite Nvidia delay

South Africa

The Top 40 index lost 0.41% on Friday to reach 102,649.8 points, while the All Share index shed 0.20% to settle at 110,022.8 points. South Africa is on track to meet its primary fiscal targets for 2025/26, stabilising debt and expanding its primary budget surplus, according to Treasury Director-General Duncan Pieterse. Early-year data show revenue up over 10% against spending growth of just 4%, aided by tighter controls on social grants and delayed budget approvals. The debt-to-GDP ratio, which rose from 26% in 2009 to 77% in 2025, is expected to stabilise before declining. Finance Minister Godongwana will present a mid-year fiscal review on 12 November, with investors closely watching business confidence, mining output, and retail sales for economic signals.

European Union

European stocks fell sharply on Friday after U.S. President Trump threatened additional tariffs on China, with the Stoxx 600 down 1.3%, Germany’s DAX off 1.4%, and the U.K.’s FTSE 100 down 0.9%. Political uncertainty in France and subdued Swiss consumer confidence also weighed on markets. Mining and defence sectors led declines amid trade and geopolitical developments, while select stocks such as Finland’s Wartsila and Denmark’s Jyske Bank gained 3.6%. Despite a flurry of potential cross-border banking deals, political interference has constrained consolidation, limiting European lenders’ ability to compete with Wall Street.

United States

Wall Street plunged on Friday after President Trump escalated the U.S.-China trade dispute, announcing a potential 100% tariff on Chinese imports and export controls on critical software. Tech stocks including Nvidia, Tesla, Amazon, and AMD fell over 2% post-market. All three major indices recorded steep single-day losses, with the S&P 500 logging its worst weekly drop since May. The ongoing U.S. government shutdown has delayed official economic data, leaving investors reliant on private reports and Federal Reserve signals. Consumer sentiment remains near historic lows amid high prices and labour market concerns.

Asia

Asian equities fell sharply on Monday as renewed U.S.-China trade tensions unsettled markets, although Wall Street futures suggested some stabilisation. Holiday trading in Japan and the U.S. contributed to choppy early sessions. China’s exports rose 8.3% year-on-year in September, ahead of expectations, while imports increased 7.4%, reflecting resilient trade activity. Beijing dismissed the latest U.S. tariff threats, calling them a “textbook double standard.” Investors remain cautious as heightened tariff rhetoric and political uncertainty in major markets continue to influence risk sentiment across the region, affecting equities and broader asset allocations.

Currencies

The South African rand weakened amid geopolitical tensions, a U.S. government shutdown, and trade-related uncertainties, while commodity gains paused. The U.S. dollar strengthened against major currencies, with the dollar index rising to 99.002 as investors reacted to Trump’s 100% tariff threat on China. Meanwhile, political developments in France and Japan pressured the euro and yen. Currency markets are being driven by heightened risk aversion, trade policy shifts, and global macroeconomic developments, with investors seeking safe-haven positions and monitoring central bank guidance for directional cues.

Commodities

Gold and silver surged to record highs on Monday as safe-haven demand intensified amid escalating U.S.-China trade tensions and expectations of Federal Reserve interest rate cuts. Oil prices rebounded after hitting five-month lows, supported by potential U.S.-China talks and robust Chinese crude imports, which rose 3.9% in September to 47.25 million metric tons. Meanwhile, China’s rare earth exports fell 31% month-on-month due to new export controls, signalling potential disruption to global supply. Commodity markets remain sensitive to geopolitical risk, trade policy shifts, and Chinese demand dynamics.

Sappi Limited (SAP) +5.10%

Sappi provided a voluntary update on actions to strengthen its balance sheet following an elevated leverage ratio driven by project-related debt, currency effects, pricing headwinds, and macroeconomic weakness. The company is prioritising debt reduction and financial flexibility, cutting capital expenditure for two years and suspending its 2025 dividend to preserve cash. Liquidity exceeds US$800 million, supported by unanimous bank approval to raise leverage covenants and plans to extend revolving credit facilities and refinance short-term debt through a new five-year term facility. Sappi remains confident in its operational resilience.

Newpark REIT Limited (NRL) 0.00%

Newpark REIT reported a 7.3% decline in revenue to R63.8 million and a 3.2% drop in operating profit to R44.5 million for the six months ended 31 August 2025, mainly due to the JSE rental reversion to market levels. Funds from operations per share fell 24.5% to 26.8 cents, while earnings per share rose to 21.8 cents. The loan-to-value ratio increased slightly to 44.5%, and net asset value per share stood at R5.62. Supported by stable valuations and sound liquidity, Newpark declared an interim dividend of 26 cents per share.

Samsung Electronics Company Limited (005930) +6.07%

Samsung Electronics is poised to report its strongest quarterly performance since 2022, with analysts projecting third-quarter operating profit of ₩10.1 trillion ($7.1 billion), representing a 10% year-on-year increase, according to LSEG SmartEstimate. The growth is primarily driven by sharply higher memory chip prices and robust server demand as clients rebuild inventories following prior shortages. DRAM prices, widely used in smartphones, PCs, and data centres, surged nearly 172% year-on-year in Q3, supporting earnings momentum. Nonetheless, delays in delivering its 12-layer HBM3E chips to Nvidia have constrained profit upside and weighed on investor sentiment. Samsung shares have climbed over 43% since July, buoyed by a $16.5 billion foundry deal with Tesla, which is expected to bolster its contract chip manufacturing business. Analysts anticipate the agreement will improve long-term competitiveness, diversify revenue streams, and strengthen strategic partnerships. Preliminary Q3 results will be released Tuesday, with full earnings later this month.

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