Powerchip shares jump on Micron’s US$1.8bn Taiwan fab acquisition

South African Market Summary

South African equities closed weaker on Friday, with the All Share Index down 0.58% to 120,169.74 points and the Top 40 declining 0.73% to 112,264.85 points. Resources underperformed, with the Resources 10 index falling 1.83%. In fixed income, government sold R225 million of inflation-linked bonds across the 2033, 2043 and 2058 maturities. Sentiment was further pressured by escalating geopolitical tensions after the US intensified criticism of South Africa’s participation in naval exercises involving China, Russia and Iran.

European Market Summary

European equities ended Friday subdued, capped by weakness in luxury and mining stocks amid a cautious close to a week dominated by the start of earnings season and ongoing geopolitical uncertainty. The STOXX 600 finished flat at 614.38 points, while the luxury sector fell 3.2%, its sharpest daily decline since early October. Richemont led losses after Bank of America downgraded the stock to neutral, citing stretched valuations. Political uncertainty also weighed on sentiment, as France’s prime minister unveiled revised 2026 budget proposals amid parliamentary deadlock.

American Market Summary

US equities finished Friday little changed in a choppy pre-holiday session, with all three major indices posting losses for the week as fourth-quarter earnings season gathered pace. Healthcare led sector declines, while semiconductor stocks outperformed, extending recent gains. Bank earnings were broadly solid, but financial stocks remained under pressure amid concerns over proposed caps on credit-card interest rates, driving the sector’s weakest weekly performance since October. Investors remained cautious ahead of the long weekend and monthly options expiry, with volatility expectations pointing to continued near-term range-bound trading.

Asian Market Summary

Asia-Pacific markets mostly weakened on Monday as investors digested geopolitical uncertainty and softer Chinese economic data. China’s GDP growth slowed to 4.5% year on year in the fourth quarter, the weakest pace in three years, as domestic consumption and investment continued to lag amid a prolonged property downturn. While full-year growth of 5.0% met Beijing’s official target, supported by resilient exports and moderated US tariff pressure, the outlook remains challenged by weak confidence and structural imbalances. New home prices fell 0.4% month on month in December, underscoring persistent property-sector strain.

Currency Market Summary

The South African rand weakened on Friday as investors remained cautious ahead of next week’s inflation data, which is expected to provide clearer signals on domestic economic momentum and the South African Reserve Bank’s potential rate-cut trajectory. In global currency markets, the US dollar softened as risk sentiment deteriorated following renewed tariff threats from President Trump against several European economies linked to Greenland. Safe-haven demand lifted the yen and Swiss franc, reinforcing a broader risk-off tone across FX markets.

Commodity Market Summary

Oil prices edged higher on Monday, extending gains from the previous session as easing geopolitical risk around Iran reduced the likelihood of near-term supply disruption. A crackdown on protests appeared to stabilise domestic conditions, while US rhetoric softened, lowering perceived intervention risk involving a key OPEC producer. However, upside momentum remained capped by bearish inventory data, with US crude stocks rising materially versus expectations. Attention is also turning to Venezuela, where potential policy shifts and an expanded Chevron licence could influence future supply dynamics, adding further complexity to the near-term oil outlook.

Remgro Limited (REM) -0.63%

Remgro issued a further cautionary announcement regarding ongoing negotiations with its joint venture partner, MSC Mediterranean Shipping Company SA, around a potential restructuring of their respective interests in Mediclinic Holdings. The discussions follow an earlier in-principle, non-binding agreement and remain subject to finalisation. Should the proposed transaction be successfully concluded, it could have a material impact on the valuation of Remgro’s securities. Shareholders are therefore advised to continue exercising caution when trading in Remgro shares until more detailed information is released.

Tongaat Hulett Limited (TON) 0.00%

Tongaat Hulett released a notice to shareholders confirming the publication of its December 2025 monthly business rescue report, the 36th since proceedings commenced in October 2022. In line with the Companies Act, the business rescue practitioners continue to provide mandatory monthly updates where proceedings extend beyond three months. The latest report includes an update on ongoing litigation matters, detailed in paragraph 2.3. Shareholders and other affected parties are encouraged to review the report for insight into the current status and progress of the business rescue process.

Powerchip Semiconductor Manufacturing Corporation (6770) +9.94%

Shares in Powerchip Semiconductor surged after Micron Technology announced plans to acquire the company’s P5 fabrication facility in Taiwan under a US$1.8 billion cash transaction. The deal, subject to regulatory approval and expected to close by the second quarter of 2026, strengthens Micron’s DRAM capacity amid structurally tight memory markets. Powerchip will retain a long-term foundry relationship with Micron, supporting advanced packaging and specialty DRAM processes. The transaction highlights sustained AI-driven demand and reinforces Taiwan’s strategic role in global memory supply chains.

Novo Nordisk (NOVOb) +6.49%

Novo Nordisk shares rose sharply following encouraging early US prescription data for its newly launched oral Wegovy weight-loss pill, the first of its kind to reach the market. Initial uptake suggests solid early demand as Novo seeks to regain momentum against rival Eli Lilly and pivot towards cash-pay consumer models. Analysts caution that pricing dynamics and insurance coverage remain key risks, but first-mover advantage could support meaningful near-term sales. The launch reinforces Novo’s strategic focus on the US obesity market amid intensifying competition.

Mercuria Energy Group Limited (Not Listed)

Swiss commodity trading group Mercuria reported profit of US$1.3 billion for the year to September, according to Bloomberg, supported by strong trading conditions despite a sharp year-on-year decline in earnings. The result was accompanied by an exceptionally low tax charge, implying a minimal effective tax rate, which flattered net profitability. Mercuria continues to expand beyond energy into metals, positioning for structural shifts in global energy and supply chains. Recent activity includes copper-linked financing arrangements, reflecting a constructive medium-term outlook for industrial metals markets.

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