South African (SA) equity markets plunged at the start of April, falling c. 14% in the days following the US announcement of sweeping trade tariffs, which saw SA exports to the US amongst the hardest hit, with 30% “reciprocal” tariffs in addition to the baseline 10% on all US imports. Ultimately, the local bourse rallied strongly to finish April comfortably in positive territory (FTSE/JSE Capped SWIX Index +4.2% MoM).
The JSE’s rally started with easing tariff-related concerns as the US announced a 90-day pause on implementing reciprocal tariffs, allowing countries time to negotiate better trade terms. President Cyril Ramaphosa appointed former deputy finance minister, Mcebisi Jonas, as a special envoy to the US. Jonas is tasked with easing tensions between the two countries. The JSE was further buoyed by the easing of domestic political tensions, as Finance Minister Enoch Godongwana, backtracked on a planned 0.5% VAT hike, removing a major sticking point amongst the governing coalition’s two largest partners (the ANC and DA), with the so-called government of national unity (GNU) surviving its first major standoff.
Gold shares (+8% MoM) were again a strong contributor to JSE performance as the yellow metal’s price continued to track higher (+5.3% MoM), though, unlike 1Q25 when the gold miners deliver the majority of JSE performance, there were substantial gains across the board in April. Clicks (+17% MoM) reported solid 1H25 earnings, with retail sales 8.3% higher YoY and EPS up 13% YoY. Management confirmed that 2H25 was off to a strong start and upped their guidance for store and pharmacy rollouts for the remainder of the year, while guiding teen earnings growth for the full year. Capitec (+11% MoM) reported 30% YoY growth in FY25 headline earnings, gaining market share in a tough operating environment. Aspen (-25% MoM) saw its share price collapse after announcing that a contractual dispute involving its French production facility could result in its earnings halving. Platinum miners (-6% MoM) also struggled, tracking platinum group metal (PGM) prices lower.
SA’s inflation data printed below expectations, and inflationary pressure remains largely absent. The country’s core inflation +3.1% YoY) has now spent eight months below the mid-point of the SA Reserve Bank’s (SARB’s) target inflation range (3%-6% YoY). The SA government’s 10-year borrowing rate (10.6% p.a.) ended the month unchanged, though much like global interest rates, it experienced some sharp intra-month moves, breaching 11.2% p.a. at one point during the month. The rand was one of only a handful of currencies to weaken against the US dollar in April (-1.5% MoM), as lingering uncertainty over the stability of the governing coalition and still frosty relations with the US prevented the domestic currency from taking advantage of a generally weaker US dollar.
