Global Economic Trends and Local Insights

US non-farm payrolls increased slightly in May, with job gains continuing but at a slower pace than in April. The US and China, the world’s two largest economies, met in London to advance trade discussions. They aimed to build mutual understanding, strengthen co-operation, and reduce miscommunication. The OECD forecasts a slowdown in global economic growth in 2025 and 2026, primarily due to weaker performance in certain countries. SA’s headline Producer Price Index (PPI) declined in May, while Consumer Price Inflation (CPI) remained steady. SA’s GDP posted modest growth in the first quarter of 2025.

Source: Graviton Perspectives

Macro Overview

Global overview

Developed market (DM) equities maintained their positive momentum into June, when the MSCI World Index ended at 4.32% m/m in US dollars. Equity markets had a brief pullback mid-month as conflict between Israel and Iran escalated, and the US got involved. Ultimately, the conflict de-escalated, and equities resumed their gains into month-end. Emerging market (EM) stocks also had a strong run in June, when the MSCI EM posted the biggest gains at 6.14% m/m in US dollars. The S&P 500 followed suit, ending at 5.08% m/m in US dollars. Global property posted gains of 1.04% m/m for June, and global bonds posted gains of 1.89% m/m over the the same period, both in US dollars.

The FTSE 100 Index gained 0.48% m/m in pounds, but the Euro Stoxx 50 Index lost -1.10% m/m in pounds. The Dow Jones Index was also positive for the month, at 4.47% m/m in US dollars. Japan’s benchmark Nikkei Index continued May’s gains into June, ending the month at 6.77% m/m in yen.

Local overview

South African equity markets had a solid end to the first half of 2025, when the FTSE/JSE All Share Index ended at 2.35% m/m in rand terms. Industrials and Property were both in negative territory in June, ending at -0.97% m/m and -0.87% m/m respectively. Resources posted the biggest gains for the month at 4.23% m/m, while Financials and Cash posted gains of 1.20% m/m and 0.60% m/m. The bond market was positive for short-, medium-, and long-term bonds, with the FTSE/ JSE All Bond Index ending the month positively at 2.28% m/m. Bonds of 1-3 years were positive at 0.87% m/m along with bonds of 3-7 years at 1.75% m/m. Bonds of 7-12 years were positive at 2.33% m/m, and bonds of 12 years and above ended positively at 3.20% m/m.

The rand strengthened against the US dollar by 1.61% m/m, but weakened against the euro by -1.73% m/m, and against the pound by -0.01% m/m.