INVESTMENT MARKET UPDATE
AUGUST 2026
What developments have unfolded in local and global markets throughout the month of AUGUST?
27
Team SA’s Commonwealth Games medal tally
$7,705
S&P500 reaches new all-time high
+5.24%
US 30-year bond yield reaches 20-year peak
CHROME - AUGUST COMMENTARY:
GLOBAL MARKETS
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🌐 Global equities gained despite pressure in bond markets
Global equity markets continued to rise in August, despite ongoing uncertainty around inflation, interest rates and geopolitical tensions. Developed market equities gained 2.6%, while emerging markets performed even better, rising 3.4%. US markets remained an important driver, with the S&P 500 gaining 2.7% and the technology-heavy Nasdaq 100 rising 4.2%.
Technology shares continued to benefit from strong corporate earnings and enthusiasm around artificial intelligence, with continued investment in semiconductors, computing infrastructure and other AI-related technologies supporting markets in the US and Asia. Strong earnings, including another positive report from Nvidia, helped reinforce confidence in the ongoing AI investment cycle.
Away from equities, global bond markets came under pressure. Concerns around persistent inflation, higher energy prices and increasing government borrowing pushed long-term government bond yields higher, as investors questioned how quickly interest rates could fall. Despite the volatility in bonds, higher yields also mean that investors are now earning substantially more income from bonds than they were several years ago.
Gold was another standout performer, gaining 9.4% in US dollars, supported by ongoing geopolitical uncertainty and concerns around inflation and interest rates.
Global Market Highlights (Month in USD):
- North America: +2.8%
- Europe ex UK: +1.6%
- UK: +1.1%
- Japan: +3.3%
- Emerging Markets:
- Asia +3.3%
- Europe +5.9%
- Latin America -1.5%
- Property: -2.9%
- Infrastructure: -1.7%
- Government Bonds: +0.2%
- Corporate Bonds: +0.6%
- Dollar Cash: +0.3%
Key Themes for Investors:
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Global equities remained resilient, with developed and emerging markets advancing despite renewed volatility from inflation, interest rates and geopolitical uncertainty.
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The AI investment theme remained an important market driver, with technology shares supported by strong corporate earnings and continued investment in AI-related infrastructure.
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Government bond yields moved sharply higher, as renewed inflation concerns, changing interest-rate expectations and heavy government borrowing weighed on long-dated bonds.
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Commodity prices were a major source of strength, particularly gold and platinum, which helped drive strong returns from South African resource shares.
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South African inflation continued to ease, providing some relief to households and reducing pressure on the SARB, although weak employment and production data continued to highlight subdued domestic economic growth.
Rand / US Dollar:
- In July, the rand has lost 1.0% against the USD. In June the Rand lost 1.3% against the USD.
- The average monthly rand appreciation over the past 12 months against the USD has been 0.7% as at end July.
Rand / Euro:
- In July, the rand has lost 2.0% against the EUR. In June, the rand gained 0.7% against the EUR.
- The average monthly rand appreciation over the past 12 months against the EUR has been 0.9% as at end June.
Rand / British Pound:
- In July, the rand has lost 2.4% against the GBP. In May, the rand gained 3.9% against the GBP.
- The average monthly rand appreciation over the past 12 months against the GBP has been 1.0% as at end June.
SMARTIE BOX IN RANDS:
LOCAL MARKETS
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South Africa: Resources drive a strong month for the JSE
South African equities had a strong August, with the JSE All Share Index gaining 4.6%. However, the headline return disguised very different performances across the market, with resources overwhelmingly responsible for the gains.
The resources sector surged 24.5%, supported by sharply higher precious-metal prices, including a 9.4% rise in gold and 8.4% rise in platinum. In contrast, financial shares declined 1.2% and industrials fell 5.6%, while small and mid-cap shares also ended the month slightly lower.
There was also some positive news on inflation. South Africa’s annual inflation rate eased from 5.0% in June to 4.3% in July, according to data released during August, helped by lower fuel prices, softer food inflation and smaller municipal tariff increases. The rand strengthened during the month, gaining approximately 2.5% against the US dollar.
South African bonds returned 0.7%, while listed property struggled, declining 3.8% during the month.
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- The JSE All Share surged in a strong month, rising 4.6%.
- Resources (up 24.5%) was the standout performer, soaring on the back of firmer commodity prices. Financials (down 1.2%) and Industrials (down 5.6%) both lost ground, weighing on the broader bourse.
- Large-caps (up 5.7%) led the charge, while Mid-caps (down 0.1%) and Small-caps (down 2.2%) ended the month in the red.
- SA Property struggled, as the SAPY fell 3.8% and S&P SA REIT Index dropped 5.5%.
- SA Nominal Bonds (up 0.7%) and Inflation-Linked Bonds (up 0.8%) both advanced, alongside SA Cash (up 0.6%).
- Global equities extended their gains, with the MSCI All Countries World Index (up 2.7%) and the MSCI World Index (up 2.6%). Emerging market equities outperformed Developed markets, with the MSCI Emerging Market Index climbing (up 3.4%) in dollar terms.
- The Rand strengthened against major currencies, appreciating against the US Dollar (2.5%), the Euro (1.6%) and the Pound (1.8%).
- Resources ended sharply higher, as precious metal prices soared in the face of geopolitical tensions. Gold (up 9.4%) jumped higher, Platinum (up 8.4%) advanced strongly, while Brent Crude (up 0.4%) was a little changed.
MONTHLY RETURNS:
