EU Court Adviser Backs Fine in Google Android Antitrust Case

Local Market Commentary

The JSE closed slightly lower, with the All Share down 0.08% at 94,914.7 points and the Top 40 slipping 0.11% to 87,373.5 points, as geopolitical uncertainty and global policy risks weighed on investor sentiment. The South African Reserve Bank flagged increased vulnerability to capital outflows and rising borrowing costs due to global tensions, particularly the escalating Israel-Iran conflict and trade friction under U.S. President Trump. SARB’s first climate risk stress test showed that major domestic banks are generally well prepared, despite gaps in data and modelling. Meanwhile, MultiChoice’s DStv platform saw a continued erosion of its subscriber base, with a net loss of 1 million active accounts over two years.

European Market Commentary

European equities slid to their lowest in over a month, with the STOXX 600 dropping 0.8% as Middle East tensions and U.S. trade policy risks unsettled markets. Central banks across Europe offered mixed signals—while the Bank of England held rates steady, the Swiss and Norwegian central banks delivered cuts, the latter unexpectedly. Volatility spiked, and German tax revenue growth moderated. Despite an uptick in UK consumer sentiment, the outlook remains clouded by energy cost risks linked to ongoing geopolitical conflict.

U.S. Market Commentary

U.S. markets were closed for Juneteenth, but futures declined sharply as the Israel-Iran conflict escalated and concerns grew over potential U.S. involvement. Wednesday’s trading ended mixed, with former President Trump hinting at possible military action. The heightened geopolitical tension continues to pressure investor risk appetite heading into the next trading cycle.

Asia Market Commentary

Asian markets traded mixed as investors assessed Chinese monetary policy and regional inflation data amid the deepening Israel-Iran crisis. South Korea's wholesale inflation slowed to its lowest pace since mid-2023, while Japan’s core inflation exceeded 2% for the 37th straight month, fuelling expectations of further rate hikes. China maintained lending rates after recent easing, signalling a cautious policy stance as economic headwinds persist.

Currency Market Commentary

The South African rand weakened on Thursday amid intensifying risk-off sentiment driven by the escalating Israel-Iran conflict, now in its seventh day. Safe-haven demand lifted the U.S. dollar, which is on track for its strongest weekly gain in over a month, with the dollar index set to rise 0.5%. Persistent geopolitical tensions and the prospect of U.S. involvement have heightened investor caution, further pressuring emerging market currencies.

Commodity Market Commentary

Oil prices climbed nearly 3% on Thursday as hostilities between Israel and Iran intensified, raising fears of wider regional conflict and potential U.S. involvement, with President Trump expected to decide on U.S. engagement within two weeks. Market anxiety surged after Israel targeted Iranian nuclear sites and Iran responded with drone and missile strikes, including an attack on an Israeli hospital. Meanwhile, Japan’s rice prices soared 101.7% year-on-year in May—the steepest increase in over 50 years—driven by inflationary pressures and tight supply, prompting government intervention amid a broader 3.7% rise in core inflation.

Standard Bank Group Limited (SBK) -0.19%

Standard Bank Group delivered a solid performance for the five months to 31 May 2025, supported by a strong transactional base across South Africa and Africa Regions amid ongoing macroeconomic uncertainty. Headline earnings rose ~10% in ZAR and mid-teens on a constant currency basis, with ROE remaining in the 17–20% target range. While balance sheet growth slowed and margins compressed, strong client activity and trading lifted non-interest revenue. Costs grew slightly ahead of revenue due to staffing, but credit impairments declined on easing arrears. Insurance and asset management earnings improved. Full-year guidance was reaffirmed, with confidence in the group’s liquidity, capital base and diversified model.

STADIO Holdings (SDO) +1.08%

STADIO Holdings grew total student numbers 8% year-on-year to 50,878 in H1 2025, driven by ongoing distance learning demand (+8%) and a strong 11% increase in contact learning. Contact learning now comprises 14% of total enrolment, up from 13% in 2024, reflecting successful in-person strategy execution. The Durbanville campus remains on track for a 2026 opening, with Phase 2 greenlit early. The R325 million development will enable capacity for over 6,000 students, supporting STADIO’s long-term growth outlook.

Libstar Holdings Limited (LBR) +16.56%

Libstar reported a 10.1% revenue rise for the 21 weeks to 30 May 2025, led by 5.2% volume growth and a 4.9% price/mix uplift, outperforming a soft consumer market. Ambient and Perishable categories grew 11.5% and 8.9% respectively, driven by demand in wet and dry condiments, expanded international listings, and improved operations in meal ingredients and snacks. Dairy and coated chicken saw solid growth, though beef sales were disrupted by a late-May foot-and-mouth outbreak. Libstar remains positive on continued trading momentum, supported by product diversity and multi-channel strategies.

Brikor Limited (BIK) 0.00%

Brikor’s revenue rose 8.6% to R380.7 million for the year, but it posted a R2.6 million loss (F2024: R8.2 million profit), largely due to a R2.4 million loss from its associate. Bricks revenue declined 6.4% to R211.5 million amid delayed construction activity and election effects. The Coal segment grew 36% to R169.3 million following a new mining agreement, but reported a R21.3 million loss, offsetting Bricks’ R26.6 million profit. A sharp rise in group expenses and a drop in pre-tax earnings to R5.3 million further weighed on results. The Board remains focused on unlocking group synergies and expanding brick and coal capacity.

Alphabet Inc.  (GOOGL) -1.49%

Alphabet’s Google faced a potential legal setback as an adviser to the Court of Justice of the European Union (CJEU) recommended dismissing the company’s appeal against a reduced €4.1 billion fine, originally imposed in 2018 for antitrust violations involving its Android operating system. The European Commission found that Google abused its dominant position by requiring manufacturers to pre-install Google Search, Chrome, and the Play Store, blocking rivals and leveraging network effects. Advocate-General Juliane Kokott rejected Google’s defence that it should be compared to hypothetical competitors, affirming the legality of the fine reduction. Android currently powers roughly 73% of global smartphones, and Google faces ongoing scrutiny with €8.25 billion in fines accrued across multiple EU investigations over the past decade.

Tesla Inc. (TSLA) +1.82%

A group of Democratic lawmakers in Texas has urged Tesla to postpone its planned robotaxi launch in Austin until September, aligning with the implementation of new autonomous-driving legislation. The lawmakers emphasise public safety and trust, requesting detailed compliance plans should Tesla proceed sooner. CEO Elon Musk had tentatively targeted a June launch with a limited fleet of Model Y vehicles operating in selected “safest” areas. The new Texas law, pending gubernatorial approval, will require autonomous operators to obtain permits and provide emergency response protocols, granting authorities power to revoke permissions if public safety is threatened. The political impact of the lawmakers’ request remains uncertain in the Republican-controlled state, while investors closely watch Tesla’s robotaxi ambitions as a key driver of its valuation.

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