JSE Top 40 Holds R84,700 as Traders Brace for Budget Vote and US Talks
The JSE Top 40 Index is hovering around R84,700 on Tuesday as markets wait with bated breath for high-stakes political and fiscal...
Quick overview
- The JSE Top 40 Index is at R84,700 as traders await the outcome of Finance Minister Enoch Godongwana's budget vote, which has failed twice before.
- The budget's success is crucial for South Africa's fiscal credibility and will influence market confidence and capital flows.
- President Cyril Ramaphosa's meeting with US President Donald Trump aims to improve diplomatic ties and trade relations, with high stakes for investment.
- The JSE Top 40 is testing support levels, with potential downside targets if the trendline breaks, while a bullish reversal could lead to higher resistance levels.
The JSE Top 40 Index is hovering around R84,700 on Tuesday as markets wait with bated breath for high-stakes political and fiscal developments. Traders are cautious ahead of Finance Minister Enoch Godongwana’s third attempt to pass the budget. His two previous attempts were blocked by coalition partners who opposed tax hikes so Wednesday’s vote is a test of the government’s fiscal credibility.
The outcome will set the tone for the second half of 2025. A success will boost confidence in South Africa’s fiscal path while another failure will deepen policy uncertainty and market volatility.
Key points:
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Budget vote on Wednesday; failed twice before
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Coalition opposition is on tax proposals
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Outcome will impact capital flows and currency
Ramaphosa’s US Trip Adds Diplomatic Risk
Meanwhile President Cyril Ramaphosa is in Washington to meet with US President Donald Trump. The aim is to reset diplomatic ties and trade relations. The stakes are high. Any signs of cooperation could unlock investment or improve trade especially as South Africa navigates a slow growth environment.
A South African delegation arrived on Monday to reestablish ties after months of geopolitical tension.
Outcomes:
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Trade alignment or investment commitments
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Positive tone will support the rand and equities
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Negative news will spark outflows and FX pressure
JSE Top 40: Technicals to Watch
The JSE Top 40 is stuck in a broadening wedge and is testing support at R84,543 which is also the 50-EMA on the 2-hour chart. Recent candles are indecisive with long wicks and tight bodies. MACD is softening just below the zero line.
If price breaks the trendline, downside targets are R83,491 and R82,729. A bounce especially on a bullish engulfing candle or increased volume could retest R85,514 and possibly R86,113.
Levels to watch:
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Support: R84,543, R83,491
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Resistance: R85,514, R86,113
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Trendline: Active since mid-April, key inflection point
New to this? Index is a tightrope walker—the trendline is the rope. Hold and it will bounce. Slip and it will drop.
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