South Africa’s minimum wage disaster, and Anthropic eyes $30 trillion in revenue

The rand is trading at one of its strongest levels in months, having broken through the R16/USD resistance level.

The local currency was steady at R15.93 against the United States dollar in early trade on Wednesday, 26 August, buoyed by a weaker greenback and better commodity prices.

The JSE also found itself at a slightly stronger point compared to Tuesday, with the All Share Index up 0.10% and the Top 40 up 0.13%.

Resource companies led the charge, with miners Harmony Gold, Valterra Platinum, and Implala Platinum all up by at least 5.5%.

Citadel Global managing director Bianca Botes said Wall Street also closed firmer on Tuesday as technology stocks rebounded from Monday’s selloff. 

The NASDAQ led this advance, gaining 0.64%, and megacaps such as Nvidia, Meta, and Micron also recovered.

The broader chip index clawed back the previous session’s losses ahead of Nvidia’s earnings release expected later on Wednesday. The S&P 500 added 0.32%, while the Dow rose 0.29%.

In Asia on Wednesday morning, the KOSPI is 1.50% stronger, leading a broad regional rebound, while the Nikkei is up 0.53%. 

The MSCI Asia Pacific Index, excluding Japan, is trading 0.7% higher, taking its lead from a stronger Wall Street and easing bond-market nerves.

In commodities markets, Brent crude oil has slipped to $85 per barrel, down by 2.4% and extending losses into a third session.

This comes as diplomatic progress between Iran and Oman in managing shipping through the Strait of Hormuz eases fears of supply disruption. 

At the same time, gold is holding near a three-month high, at $4,650 per ounce, underpinned by a soft dollar as US authorities intervene in the bond market. 

Botes said markets will keep an eye on US data releases today, which will include the second estimate of US second-quarter GDP 

On Wednesday morning, the rand was trading at R15.93 against the US dollar, R18.58 against the euro, and R21.71 against the British pound.

Important finance and investing news

Anthropic sees $30 trillion in revenue: Anthropic is expected to tell investors that its revenue potential exceeds $30 trillion. This is higher than SpaceX’s $28.5 trillion estimate. To justify this claim prior to its IPO, Anthropic said it is looking at the full scope of work that could be done with AI. [Wall Street Journal]

Big win from the United States: The United States’ National Institutes of Health has lifted its ban on South Africa, 18 months after its February 2025 order to stop work with South Africa. This frees up vital funding for medical research in the country. [EWN]

US Treasury feeling the heat: The chorus of voices criticising US Treasury Secretary Scott Bessent’s bond buyback strategy continues to grow. “Governments defending prices against fundamentals always lose,” investor Stanley Druckenmiller argued. [Semafor]

Nvidia day: Nvidia is set to report its second-quarter earnings on Wednesday, a key test for the AI-fuelled equity surge. Nvidia is expected to report revenue of $92 billion, according to Bloomberg analyst consensus estimates. That would mark a 96% year-over-year jump in overall revenue. [Yahoo Finance]

South Africa’s minimum wage disaster: South Africa’s minimum wage covers less than half of a basic food basket. The PMBEJD’s calculations show that a South African on the minimum wage of R30.23 an hour will be left with R1,653 to spend on food and other basic needs after transport and electricity costs. [BusinesDay]