The Johannesburg Stock Exchange All Share Index (JSE ALSI) crossed the 100,000-point mark for the first time in history, closing the quarter at an all-time high of 101,835. This performance underscores robust investor confidence, supported by improving global sentiment, easing inflationary pressures, and a strengthening rand.
Key drivers of this rally included resource stocks, particularly platinum miners, which rebounded sharply due to global supply constraints and rising prices – despite the proposed 30% tariff on platinum imports by U.S. President Donald Trump. Financials and industrials, posted strong earnings and dividend announcements, further boosting sentiment. Mid- and small-cap stocks also participated in the rally, indicating broad-based market strength.
South Africa’s inflation remained subdued throughout the quarter, while the rand held steady and strengthened notably in August, despite elevated interest rates. However, economic growth remains fragile, constrained by limited fiscal space and rising government debt, now standing at 77% of GDP.
Encouragingly, Q2 2025 saw modest recovery in the mining, manufacturing, and retail sectors, supported by structural reforms and improved electricity supply. Yet, the labour market continues to struggle as the official unemployment rate rose to 33.2%, marking the second consecutive quarterly increase. Youth unemployment remains alarmingly high, with over 8.2 million people unemployed, up by 237,000 from the previous quarter.
After significant delays, Parliament passed the 2025 Appropriation Bill on 23 July 2025, securing R2.3 trillion in funding for the 2025/26 fiscal year. The bill received strong support from the Government of National Unity (GNU), with 262 votes in favour and 90 against. This approval marked the final step in the annual budget process and outlines allocations across national departments, infrastructure upgrades, social grants, and debt servicing.
Corruption appears deeply rooted, and the ANC’s electoral decline has intensified its political maneuvering. The suspension of Police Minister Mchunu, following explosive allegations by General Mkwanazi, has heightened uncertainty, placing pressure on President Ramaphosa to assert leadership amid growing internal fractures.
On the international front, President Trump’s tariff strategy continues to disrupt global trade flows. Economists remain divided on its inflationary impact, with many operating in a vacuum of reliable data. In response, South Africa, China, Russia, and South America are actively discussing bilateral trade agreements, which could reshape global trade dynamics.
Meanwhile, China’s economy is showing renewed strength, with a more business-friendly approach, particularly in the technology sector. This momentum is being fuelled by a strategic pivot toward innovation and a more open stance toward private enterprise. There’s also a noticeable shift in regulatory tone. The government is now encouraging investment and entrepreneurship which is helping restore investor confidence and attract global capital.
The United Kingdom is navigating a turbulent period marked by the departure of high-net-worth individuals and increased migration, both of which are placing added pressure on public finances. The newly elected Labour government has introduced a series of controversial immigration reforms – including stricter visa requirements, suspended refugee family reunification routes, and plans to phase out asylum hotels – that have sparked confusion and unrest among the public. This has led to public sentiment growing increasingly polarized, with protests erupting across the country and criticism mounting over the government’s inconsistent messaging and reactive policy shifts. As Labour attempts to balance border control with humanitarian obligations, the lack of clarity and cohesion in its approach is fuelling social tension and undermining confidence in its leadership.
Below is an indication of how the Global Bourses have fared over the last few quarters:
The below graph tracks the performance of the Rand against the US Dollar over an eight-year period:
The below graph tracks the performance of the JSE All Share Index over an eight-year period:
On the compliance front, businesses are preparing for the implementation of COFI (Conduct of Financial Institutions Bill) – a comprehensive legislative reform that consolidates multiple financial acts. Although no official implementation date has been announced, companies are expected to begin aligning with its provisions. COFI is anticipated to impact annual compliance requirements, and we will continue to keep stakeholders informed as developments unfold.
South Africa’s economic and market resilience offers cautious optimism, yet persistent unemployment, political instability, and global headwinds continue to pose significant risks. A strategic emphasis on inclusive growth, governance reform, and proactive regulatory alignment will be vital in steering through the challenges ahead.
As we navigate a complex and evolving landscape, South Africa continues to show remarkable resilience and potential. With steady progress in key sectors and renewed investor confidence, there are reasons to remain hopeful. Embracing opportunities with optimism, collaboration, and a shared commitment to growth is not just a strategy – it’s the key to enduring success. As we move forward, let’s continue building momentum together, with purpose and positivity.