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World shares hovered around record highs on Wednesday, as traders found ways to justify why increasingly complicated world economics and politics would not affect stocks, though jitters were apparent in precious metal and oil markets.
Silver rose to $92 per ounce for the first time on Wednesday. It began 2025 under $30 an ounce, and has surged 29% in the first nine trading days of the year.
Gold is back at record highs, and up 7% in the first two weeks of the year, while copper is also at unprecedented levels.
Fears about everything from Federal Reserve independence to the pressure US aspirations to own Greenland is putting on the NATO alliance via the implications of large protests in Iran are still firmly near the top of investors’ minds.
Concerns over Iranian supply disruptions sent oil prices higher for a fifth straight session on Wednesday, with Brent futures up 1.36% at $66.3 a barrel.
Oil producer Sasol jumped 5% on Wednesday, while Implats and Northam gained more than 3%. However, goldminer Harmony fell almost 4%.
The JSE’s All-Share Index ended slightly lower, while broad share indexes in Asia and Europe both rose to all-time peaks with the former buoyed by Japanese markets, as investors braced for a possible election that could lead to more stimulus there.
Investors were trying to balance those big-picture concerns with what will be a busy day in terms of short-term developments with US corporate earnings gathering pace and a raft of Federal Reserve speakers.
That optimism could peter out in the US, however, with S&P 500 futures down 0.4%, partly due to premarket falls from Citi and Wells Fargo after their results.
“We are starting the year as we left off last, people are very positive towards equities, and within that there is a slow burn rotation from the US to the rest of the world, whether out of conviction or risk management, is hard to say,” said Ben Laidler, head of equity strategy at Bradesco BBI.
“What’s different is policy uncertainty, led by the US, has spiked, and that’s generated headlines around ‘sell America’.
“While that hasn’t happened - the dollar’s got a bit of a safe-haven bid - we are seeing it play out in this incredible metal rally,” he said.
Even if investors did not have to make time for thinking about great power politics and the importance of central bank independence, Wednesday would have been busy.
Shares of Bank of America rose in premarket trading after it beat estimates for fourth-quarter profit, as its traders capitalized on volatile markets, but those of Wells Fargo and Citigroup fell with the latter booking a $1.2 billion loss tied to the sale of its Russia business.
JPMorgan Chase on Tuesday said its profit exceeded analysts' estimates as its traders cashed in on volatile markets, though its shares fell as investment banking revenue missed.
Investors are also processing news that US high-end department store conglomerate Saks Global filed for bankruptcy protection.
Earlier in the day, Japan was the main focus as Prime Minister Sanae Takaichi moves towards holding a snap lower house election on February 8.
That sent the Nikkei up over 1% to a record and pushed Japanese government bond prices lower, a so-called "Takaichi trade" that appears to have been turbocharged this week as investors fret about the country's fiscal health.
That is bad news for the Japanese yen, which fell to its weakest level since July 2024 but was last stronger at 158.63 per dollar after Japanese authorities reiterated warnings they may intervene directly in markets to stop its slide.
Other currencies were broadly steady, with the euro flat at $1.1648. The rand was flat at R16.40/$.
The benchmark 10-year Treasury yield was marginally softer at 4.16%.
China stocks reversed course to trade 0.4% lower after Chinese stock exchanges tightened margin requirements
in a surprise move to cool the red-hot equity market. Blue-chip stocks had hit a 10-year high on Tuesday.
Investors mostly looked past trade data where China reported a record trade surplus of nearly $1.2 trillion in 2025, led by booming exports to non-US markets.
Additional reporting on JSE and rand by News24.
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