Economic & Market Overview — April 2026

April Overview

Global markets staged a strong recovery in April, despite a complex and often contradictory macro backdrop. The MSCI World Index rose 9.4% month-on-month, returning to positive territory for the year at +5.2%, as resilient corporate earnings and improving investor sentiment offset persistent geopolitical tensions, elevated oil prices and renewed inflation concerns. While the escalation in the US/Israel/Iran conflict continued to pose risks to global stability, intermittent optimism around potential de-escalation, combined with stronger-than-expected economic data, supported a rebound in risk appetite.

At the core of this resilience was a notable divergence between macroeconomic headwinds and corporate fundamentals. A robust first-quarter earnings season in the United States, particularly within technology and AI-linked sectors, provided a strong anchor for equity markets. This strength helped investors look through ongoing geopolitical uncertainty, even as oil prices remained volatile. The volatility reflected ongoing concerns around supply disruptions, particularly linked to developments in the Strait of Hormuz, as well as broader structural uncertainty within global energy markets. In the United States, equity markets led the global recovery, with all major indices delivering strong gains. The S&P 500 rose 10.4% month-on-month, bringing its year-to-date return to +5.3%, while the Nasdaq surged 15.3% over the same period and is now up 7.1% for the year. The Dow Jones Industrial Average increased 7.1% in April, lifting its year-to-date performance to +3.3%. The rally was driven largely by strong corporate earnings growth, particularly within mega-cap technology companies, alongside continued enthusiasm around artificial intelligence-related investment themes. US economic data released during the month were mixed. Headline inflation rose to 3.3% year-on-year in March from 2.4% previously, while core inflation edged up to 2.6%. Economic growth showed some improvement, with first-quarter GDP expanding at an annualised rate of 2.0%, although this was slightly below earlier estimates. Against this backdrop, the Federal Reserve maintained its policy rate, adopting a cautious and somewhat hawkish tone amid concerns that rising energy prices could sustain inflationary pressures.

European markets also rebounded following the sharp declines in March, although performance lagged that of the United States. The Euro Stoxx 50 increased 5.0% month-on-month and is now marginally positive for the year at +0.5%. Regional markets remained sensitive to fluctuations in energy prices, given Europe’s reliance on imported energy. Germany’s DAX rose 7.1% in April, while France’s CAC gained 3.8%. Inflation in the euro area accelerated to 2.6% year-on-year in March, driven largely by higher energy costs, reinforcing the cautious stance of the European Central Bank. The United Kingdom delivered more modest gains, with the FTSE 100 rising 2.0% in April and maintaining a year-to-date return of +4.5%. Inflation increased to 3.3% year-on-year in March, primarily driven by higher transport costs, while core inflation eased slightly to 3.1%. The Bank of England kept interest rates unchanged at 3.75%, balancing persistent inflation pressures against a still-fragile growth environment.

Emerging markets experienced a strong recovery, supported by improved risk sentiment and a weaker US dollar. China’s equity markets recorded gains despite continued volatility, with the Shanghai Composite rising 5.7% month-on-month and Hong Kong’s Hang Seng increasing 4.0%. Economic data were mixed, with manufacturing activity remaining in expansionary territory while non-manufacturing indicators softened slightly. Japan was among the strongest-performing major markets, with the Nikkei surging 16.1% in April, driven by continued strength in technology and AI-related sectors. Inflation edged higher to 1.5% year-on-year but remained below the Bank of Japan’s target, allowing policymakers to maintain an accommodative stance while monitoring the potential impact of rising energy costs.

Commodity markets remained volatile throughout April. Oil prices experienced significant intra-month swings, reflecting ongoing geopolitical tensions and uncertainty around global supply dynamics. Despite these fluctuations, Brent crude ended the month lower on a month-on-month basis. Outside of energy, performance was mixed. Gold declined 1.1% over the month as rising bond yields and a firmer US dollar reduced its appeal as a non-yielding safe-haven asset.

South African markets experienced a more muted recovery relative to global peers, reflecting their sensitivity to commodity prices, currency movements and global risk sentiment. The FTSE/JSE All Share Index increased 1.0% month-on-month but remains slightly negative for the year at -0.6%. The rand strengthened by 1.6% against the US dollar during the month, supported by a weaker greenback and improved global sentiment. On the domestic macro front, inflation edged higher to 3.1% year-on-year in March, although this figure largely predates the recent surge in global energy prices. The South African Reserve Bank is likely to adopt a cautious stance, with the potential for renewed policy tightening should inflationary pressures persist.

Market Performance

Market indices as at 30 April 2026. All returns in Rands except where otherwise indicated.

A + indicates a stronger rand. Source: Morningstar Direct.