Tesla gains on $16.5bn Samsung chip deal despite soft Q2 earnings

South Africa

The Top 40 index lost 0.23% yesterday as it closed out the day at 91,097.5 points, while the All Share index shed 0.22% to drop to 98,696.4 points. The South African Reserve Bank is expected to cut the repo rate by 25 basis points on Thursday, further narrowing the country’s yield differential versus safer markets. The move comes ahead of the implementation of 30% US tariffs on South African goods on Friday, with no trade deal yet agreed, placing pressure on agriculture and automotive sectors. Meanwhile, South Africa secured a €500 million (R10.4 billion) concessional climate loan from Germany’s KfW at a fixed 4.31% rate, supporting its energy transition. Key domestic data this week include June credit extension, budget figures, PPI and trade, offering further signals on economic momentum.

Europe

European markets opened higher but pared gains as investors reassessed the implications of the US–EU tariff accord. The STOXX 600 finished marginally lower, weighed down by industrial and pharmaceutical names. Auto manufacturers, notably in Germany, came under pressure as the new tariff regime disproportionately affected high-value exports. The euro weakened against the US dollar, reflecting modestly downgraded growth expectations. European government bond markets were stable, with the German Bund yield hovering near 2.44% ahead of mid-week eurozone inflation and GDP prints. Market tone remains cautious pending further detail on transatlantic trade enforcement.

United States

US equity indices were mixed, with the Nasdaq and S&P 500 notching fresh record closes amid ongoing investor enthusiasm for AI and semiconductor names. Tesla advanced over 2% following a $16.5bn chip supply deal with Samsung. The Dow underperformed slightly, dragged by healthcare and energy. Treasury yields ticked higher, with the 10-year closing above 4.4%, as investors digested better-than-expected corporate earnings and adjusted rate-cut expectations. Markets are now focused on upcoming PCE inflation data and Friday’s payrolls report for further guidance on the Fed’s September policy path.

Asia

Asian equity markets posted modest gains, supported by positive sentiment from the US–EU trade deal. However, regional performance was uneven. The Nikkei fell 0.8% on profit-taking after strong July gains, while Chinese A-shares were flat as investors weighed property-sector concerns against potential policy easing. The MSCI Asia-Pacific index was marginally positive, underpinned by gains in South Korea and Australia. Currency markets in the region were stable, although the Japanese yen weakened slightly amid rising US yields. Investors remain focused on upcoming Bank of Japan guidance and key economic data out of China.

Currencies

The US dollar extended its rally, gaining broadly against G10 peers as markets priced in fewer Fed cuts in 2025. The euro weakened by around 1.3% following cautious EU macro outlook revisions and subdued inflation expectations. The South African rand depreciated to R18.01/USD despite improved global risk appetite, reflecting softer domestic fundamentals and some residual commodity-linked volatility. Sterling was range-bound, supported by steady UK Gilt yields ahead of upcoming BoE commentary. The Japanese yen slipped slightly as rising US yields made dollar carry trades more attractive. Emerging market FX was mixed, with Latin American currencies mostly firmer.

Commodities

Crude oil prices advanced, with Brent climbing 1.4% to above $84/bbl amid tightening physical markets and anticipation of further OPEC+ production restraint. WTI also gained, aided by improved risk sentiment and a weaker dollar. Gold slipped below $2,340/oz, reversing early gains as appetite for safe-haven assets faded following the US–EU tariff accord. Platinum and palladium traded higher on renewed supply concerns, particularly after Valterra Platinum's profit warning in South Africa. Copper remained range-bound as Chinese industrial signals remained mixed, while agricultural commodities were broadly steady amid favourable weather patterns in the US Midwest.

Valterra Platinum Limited (VAL) 0.00%

Valterra Platinum reported a materially weaker H1 2025, with EBITDA down 46% to R6.6bn and headline EPS falling 81% to R4.73, largely due to a 25% drop in PGM sales volumes following flooding at Amandelbult and demerger-related costs of R1.4bn. The group confirmed its first interim dividend post-demerger at R2.00 per share, in line with its 40% payout policy. Despite operational disruptions, cash costs fell 2% to R17,952/oz, excluding flooding impacts, aided by R2.1bn in cost savings. Net debt remains low at 0.3x EBITDA. FY production guidance was reaffirmed, though expected at the lower end of the range. Capex was revised down by R1bn.

Sea Harvest Group Limited (SHG) -0.65%

Sea Harvest issued an upward revision to its prior trading statements, guiding for HEPS of 93.4–95.8 cents, up 88–93% YoY, and EPS of 96.8–99.8 cents, a 60–65% increase from the 61 cents reported in H1 2024. The earnings uplift is attributed to strong international pricing for Cape Hake, improved catch rates, and efficiency gains in its South African Fishing business. Solid milk flow supported the Dairy segment, while the Abalone unit underperformed on weaker Asian demand and Rand strength. The formal H1 results are expected by 1 September 2025. No review or audit of the forecasted data has yet been conducted.

Tesla Inc. (TSLA) +3.02%

Tesla shares rose approximately 3–4% following the announcement of a $16.5 billion multiyear contract with Samsung to produce next-generation AI6 chips at Samsung’s Texas facility through 2033. The agreement reinforces Tesla’s strategic focus on autonomy and robotics, providing near-term support to sentiment despite a softer Q2 earnings print. The company reported revenue of $22.5 billion and non-GAAP EPS of $0.40, marginally below consensus, with automotive revenue down 16% year-on-year. Management cautioned that several “rough quarters” may lie ahead as US EV tax credits begin to expire. Longer-term equity narratives remain centred on Tesla’s AI, robotaxi, and Optimus initiatives.

Whirlpool Corporation (WHR) -1.83%

Whirlpool slashed its full‑year adjusted earnings guidance to a range of $6.00–$8.00 per share, down from a prior estimate of $10.00, in response to sharply increased competition from Asian imports ahead of anticipated U.S. tariff enforcement. The company also proposed reducing its quarterly dividend from $1.75 to 90 cents to rebalance debt and reinvest in domestic manufacturing. Shares fell about 9% in after‑hours trading. The revision signals near‑term profitability pressure in the appliance sector, with markets likely to await absorption of tariff actions before stability returns.

Advanced Micro Devices Inc. (AMD) +4.32%

AMD shares rose approximately 4.3%, driven by bullish commentary—UBS raised its price target on strong AI chip demand—and the company’s move to hike pricing on certain AI-related products. While not releasing new earnings on 28 July, AMD remains in focus as sentiment around demand for AI accelerators and datacentre inventory rebuild continues to underpin valuation. The semiconductor group's multiple expansion appears justified for now, pending formal data releases later in the week. 

Do you prefer a full in-depth report you can read offline? Click here to download the full report.