By Daniel Wesonga, Senior Sales Manager at Pepperstone
South African equities edged higher in early Tuesday trading, supported by gains in consumer durables, distribution services, and health services, while producer manufacturing, health technology, and commercial services underperformed. The market stabilized to a certain extent after a series of corrections but remained on a strong positive course overall.
A 26% rise in South Africa’s agricultural exports to the US in Q2 2025, reaching USD 161 million, could help improve sentiment. Key exports included citrus, wine, fruit juices, and nuts. However, future growth will depend on securing better trade terms and diversifying export markets to offset tariff pressures. A strong export performance could continue to support domestic equities as investors would anticipate sustained corporate earnings growth. Conversely, a lack of progress around tariffs may weigh on sectors exposed to international trade.
Looking ahead, market participants are awaiting Wednesday’s South Africa inflation report for July, expected to rise to 3.6% year-on-year. In June, annual inflation increased to 3%, the highest in four months. If July follows the trend, mounting price pressures could weigh on consumer-focused sectors, while softening core inflation may provide some relief, supporting interest rate-sensitive equities.