Last week in review
Global equity markets closed the week on a cautious note as investors weighed geopolitical developments, central bank expectations, and the early stages of the fourth-quarter earnings season.
In the United States, major indices ended Friday largely unchanged. The S&P 500 and Nasdaq hovered around flat territory, while the Dow Jones Industrial Average slipped by 80 points. Market sentiment was influenced by uncertainty around Federal Reserve (Fed) leadership after President Donald Trump indicated he may retain Kevin Hassett as an economic adviser rather than appointing him as Fed Chair. This has fuelled speculation that former Fed Governor Kevin Warsh could emerge as a leading candidate.
Technology stocks provided some support, particularly within the semiconductor space. Shares of Taiwan Semiconductor, Nvidia, and Micron advanced on the back of strong earnings results, continued optimism around artificial intelligence, and a US–Taiwan trade agreement that includes roughly $250 billion in investment into US-based production. Financial stocks, however, underperformed despite solid earnings, weighed down by concerns over a proposed cap on credit card interest rates. For the week, the S&P 500 edged down 0.10%, the Nasdaq fell 0.4%, and the Dow closed flat.
In commodities, oil prices climbed modestly, with WTI crude settling 0.40% higher at $59.44 per barrel. Prices rose more than 1% over the week amid lingering geopolitical risk, particularly surrounding Iran. Earlier in the week, fears of potential supply disruptions pushed oil to multi-month highs following protests in Iran and speculation of possible US military action. However, those gains were tempered after reports suggested Washington may delay intervention. Meanwhile, gold prices fell roughly 1% to around $4 560 per ounce as safe-haven demand eased and expectations for near-term US rate cuts diminished.
European markets closed slightly lower, retreating from record highs reached earlier in the week. The STOXX 50 declined 0.30%, while the broader STOXX 600 edged marginally lower. Luxury stocks led losses as companies warned of weaker fourth-quarter earnings. Germany’s DAX slipped 0.20%, with sentiment dampened by ongoing geopolitical uncertainty, including tensions involving Iran and rising friction between the US and Europe over Greenland.
Asian markets were mixed. Hong Kong’s Hang Seng fell 0.30% as investors adopted a cautious stance ahead of key Chinese economic data due next week. Mainland Chinese equities also declined following Beijing’s decision to tighten margin financing rules. Despite Friday’s pullback, Hong Kong stocks posted a solid weekly gain after the People’s Bank of China signalled further policy support. In Japan, the Nikkei and Topix both ended lower as investors awaited the Bank of Japan’s policy decision and monitored domestic political developments.
Locally, the South African rand weakened slightly as investors awaited upcoming inflation data. November inflation slowed to 3.50%, remaining within the SARB’s target range, with markets looking for further clarity on the central bank’s interest-rate trajectory.
Thanks to PSG Wealth for the market review.
Financial Indicators by Sharedata.co.za
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