JSE Up 0.19%—Top 40 Climbs as US-China Tensions Loom

The Johannesburg Stock Exchange (JSE) managed a modest gain of 0.19%, with the FTSE All Share Index (JALSH) closing at 90,720.33 ZAR. Despite persistent global uncertainties, particularly surrounding US-China relations, South African equities continued to demonstrate resilience. Local markets benefited from a broader risk-on mood, fueled by a softening US dollar and renewed speculation over future Federal Reserve rate cuts.

Global Tensions Keep Markets on Edge

US-China tensions continue to weigh on global markets but investors are holding onto hope that diplomacy will ease trade and political tensions. This has kept risk assets buoyant and the JSE is reflecting the balance between global worries and risk appetite. The outlook is still uncertain but SA stocks are holding firm.

• FTSE All Share Index (JALSH): 90,720.33 ZAR (+0.19%)

• Market drivers: US-China diplomacy, risk sentiment

Weaker USD Supports Risk Assets

The USD is struggling to hold onto its recent gains and is expected to ease by as much as 1% by 2025. A softer USD environment is good for emerging market equities and commodities and indirectly for the JSE. With US inflation and labour market data next week (JOLTS, PCE, non-farm payrolls) investors are bracing for volatility that could impact the USD and global risk trends.

• Fed Speculation: Easing by 2025

• Impact: Weaker USD good for SA equities and commodities

JSE Technical Outlook: Resistance near 84,900

From a technical perspective the SA JSE Top 40 Index (SA40) is trading at 83,445 after a strong recovery from the April lows. But momentum is stalling as the price approaches the heavy resistance zone 84,898 to 85,897 ZAR.For newbies this is called a resistance test—where price is near a ceiling where sellers have pushed back. Unless the SA40 breaks 84,900 with volume, a short term pullback to 82,059 or 81,965 (the 50-period EMA) could happen.

Trade Plan:

• Buy breakout: Only above 84,900 with momentum

• Upside targets: 85,897 and 86,945

• Support to monitor: 82,059 and 81,965

• Stop-loss: Below 81,965

Be patient here—waiting for a clean breakout confirmation can avoid getting caught in the resistance range.