Daniel Wesonga
South African equities retreated on Tuesday as investors moved to secure their gains after a strong rally. Sector performance was broadly negative, with 14 out of 20 sectors in the red, while energy minerals, consumer durables, and utilities managed gains. Communications, commercial services, and industrial services were among the weakest performers.
This comes despite relatively positive data from the South African Reserve Bank. The June composite leading business cycle indicator rose 0.4% after a 1.3% decline in May, supported by faster growth in real M1 money supply and higher US dollar–denominated export commodity prices.
Looking ahead, market participants will turn to Thursday’s release of South Africa’s July PPI inflation figures, following June’s four-month high of 0.6% year-on-year. A stronger reading may weigh on equities by raising input cost pressures, while a softer outcome could provide support by easing margin concerns.
