Rand retreats from five-month peak as property sector boosts market gains

South Africa’s rand softened slightly on Friday after reaching its strongest level in five months having touched an intraday peak of 17.99 earlier in the session. This appreciation was driven by investor optimism following Deputy Finance Minister David Masondo’s announcement of an upcoming new inflation-targeting strategy. Meanwhile, President Cyril Ramaphosa is set to meet US President Donald Trump in the week in an effort to ease diplomatic tensions. The rand traded at 18.19 by 17h40 SAST on Friday. Financial markets ended the day on a positive note, supported by gains in the property sector with the All Property Index climbing 1.29% to 10 046 points. The FTSE/JSE All Share Index (ALSI) increased by 0.30% to close at 92 619 points, while the FTSE/JSE Top 40 Index rose 0.36% to finish at 85 103 points. 

Eurozone markets closed on a positive note on Friday, supported by strong corporate earnings and notable performances in luxury goods sectors. The UK’s FTSE 100 rose by 0.45% to end the day at 8 672.30, while the STOXX 50 added 0.29% and the broader STOXX 600 climbed 0.42%. Among the top performers was German battle tank components manufacturer Renk, which saw its shares surge by 8.50% after JPMorgan upgraded the stock to ‘overweight.’ Luxury goods group Richemont also posted impressive results, with its share price rising 6.50% following a strong boost in quarterly sales. On the downside, Novo Nordisk slipped around 3% after announcing the resignation of its CEO, raising concerns about its position in the competitive obesity drug market. Meanwhile, E.ON shares dropped 3.90%, making it one of the weaker performers on the day.

Wall Street ended the week on a strong note, with all three major indices posting solid gains, supported by the easing trade tensions between the US and China. The S&P 500 rose by 0.70% on Friday to close at 5 958.38, marking its fifth consecutive daily gain, while the Nasdaq added 0.52% concluding at 19 211.10 and the Dow advanced by almost 332 points, erasing its year-to-date losses. A 90-day tariff truce agreed earlier in the week helped lift market sentiment, pushing the S&P 500 back into positive territory. Performance among big tech shares were mixed, with Alphabet rising 1.20% and Meta slipping 0.50%. Tech stocks led the rally, spearheaded by Nvidia’s 16% surge. Meta rose 8%, Apple climbed 6%, and Microsoft added 3%. However, Moody’s Investors Service downgraded the US credit rating by one notch, from Aaa to Aa1, citing concerns over rising debt levels and growing interest payments. The agency projected that US federal debt would rise to around 134% of GDP by 2035, up from 98% last year. Moody's made this announcement on Friday, changing its outlook on the US to stable from negative.

Asian markets closed mostly lower on Friday, as investor sentiment remained cautious amid mixed economic data and continued geopolitical concerns. Japan’s Nikkei edged down slightly by 1.79 points to end at 37 753.72, following a disappointing GDP report that showed a 0.20% contraction in the first quarter of 2025. The Hang Seng Index dropped by0.42%, to close at 23 355.68, weighed down by concerns over potential US sanctions targeting Chinese technology firms. Meanwhile, China’s Shanghai Composite retreated by 0.43% to settle at 3 366.38, as investors remained cautious ahead of key upcoming economic data releases.

WTI crude oil futures rose by 1.40% to settle at $62.50 per barrel on Friday, recording a weekly gain of over 2%, while Brent crude oil settled $65.33 per barrel, rising by 1.24%. Uncertainty persisted regarding the potential US-Iran nuclear agreement, which could add an estimated 400 thousand barrels per day to global supply. Despite this possible increase, optimism around prospective US interest rate cuts continued to support a bullish outlook by potentially stimulating economic activity and boosting oil demand. Gold closed higher by 0.36% at $3 203.58 per ounce and platinum had a marginal increase of 0.04%.