Outlook

The situation remains fluid, and volatility can work in either direction. But if you’re expecting the cavalry to ride in to save the markets from themselves, don’t.

Despite economic setbacks during the Great Recession and Covid-19, South Africa is poised to almost double its growth in 2025 and 2026. Financial reforms, lower rates and inflation are expected to foster an environment of stronger consumer spending.

Three pivotal events mark shifts in market sentiment over the four months since November 2024—the US election outcome, the Fed’s December policy meeting and the February 2025 release of a key US consumer sentiment survey.

No one will know for sure, but I could imagine that if the end-of-quarter activity drove today’s gains, the rally likely won’t last and, more importantly, could be given back pretty fast.

Amid all the market turbulence of late, the Fed was a steadying influence. Stocks notched a solid gain last week as upbeat comments from the Fed helped stocks snap their four-week losing streak.

If the tariff news is generally good, then it’s a reason for optimism. If the adjustments turn out to be less meaningful, that can be overlooked if it means that the administration is willing to offer periodic bullish tidbits to the market.

The S&P 500 is not often down for five consecutive weeks, so one has to think this might be the week the market attempts a rebound. There’s a good chance of a bounce, but whether it happens is another question.

Cracks began to emerge in the bullish USD story during February as poor retail sales and plunging services PMI reinforced negative fiscal headlines.

The cooler-than-expected CPI report initially pushed equities higher after the news, but once implied volatility reset, the rally fizzled, and choppy price action took over.

By Tuesday's close, all three averages were down 3 percent on the week, and the S&P had given up its post-election gains. Stocks fell as tariffs affected Canada, Mexico, and China. Each country announced retaliatory tariffs of their own, further fanning inflationary fears among investors.

The week began under pressure after the White House said 25 percent tariffs on Mexico and Canada would begin after the 30-day pause ends in early March.

Traders are picking up the risk-off playbook in response to Washington implementing levies on products from Canada, China and Mexico.