By Daniel Wesonga

South African equities may continue to face correction following a -0.20% decline in the JSE FTSE Top 40 index during the previous session, encountering resistance near the 80,000 points mark. The overall performance was mixed, with 9 out of 20 sectors ending in the negative. The electronic technology sector led with a 10.53% gain, followed by communications and consumer durables, which rose 1.62% and 1.56%, respectively. Conversely, distribution services, utilities, and non-energy minerals posted losses of -2.66%, -1.88%, and -1.44%, respectively. This sectoral disparity suggests market uncertainty. The near-term outlook for South African equities remains volatile.

Among top constituents, Firstrand Ltd, Capitec Bank, and Standard Bank Group ended in the red, down -0.38%, -0.70%, and -0.91%, respectively. Meanwhile, MTN Group advanced by 2.41%, Vodacom Group rose by 0.90%, and Naspers Ltd increased by 0.12%. Financial stocks are lagging, while telecommunications and media stocks remain strong.

South Africa’s manufacturing production decreased by 1.2% year-on-year in December, following a revised 1.9% drop the previous month. The broader economic environment remains challenging, with U.S. tariffs on steel and aluminum imports creating an environment of uncertainty. The cautious economic outlook suggests potential near-term pressure on the South African equity market.

Wesonga is Senior Sales Manager at Pepperstone