The South African rand traded near a five-month high early on Wednesday, at 17.9525 ZAR/USD, ahead of Finance Minister Enoch Godongwana's presentation of a new national budget and President Cyril Ramaphosa's scheduled meeting with US President Donald Trump. The rand's strength reflects investor optimism, despite previous budgetary disagreements among coalition partners. The benchmark 2030 government bond yield remained stable at 8.87%.

US stocks closed lower on Wednesday, with the S&P 500 and Nasdaq both falling 0.50%, and the Dow Jones losing over 300 points. Investor sentiment weakened amid concerns over the US fiscal outlook, with discussions around President Trump's tax-and-spending bill potentially increasing budget deficits by nearly $3 billion over a decade. Additionally, a 30-year Treasury yield above 5% raised concerns about higher borrowing costs impacting equities.

The FTSE 100 ended flat after recovering from earlier declines, outperforming other major European indices. Marks & Spencer shares jumped up to 5% after reporting strong earnings, boosted by the popularity of new bakery items, though gains were tempered by ongoing issues from a cyber-attack that disrupted its website. JD Sports saw a sharp drop of around 10%, as concerns over potential tariffs clouded its business outlook.

European stocks closed flat on Wednesday, holding near two-month highs. The STOXX 50 closed at 5 455, and the pan-European STOXX 600 remained at 554. Tech shares led the gains, with Infineon jumping 2.50% after announcing a collaboration with Nvidia to develop new power delivery architecture for data centers.

In Japan, the Nikkei 225 fell 0.60% to close at 37 315, following fresh trade data showing exports grew at the slowest pace in seven months in April, as rising US tariffs began to weigh. Meanwhile, the Shanghai Composite rose 0.20% to close at 3 387, and the Shenzhen Component advanced 0.40% to 10 294, as market sentiment improved after the People's Bank of China cut key lending rates for the first time in seven months.

WTI crude oil futures reversed earlier gains to trade around $62 per barrel after a surprise build in U.S. crude inventories. The EIA reported a 1.328 million barrel increase in crude stocks, defying expectations for a 1.85 million barrel draw. Gold rose to around $3 300, nearing a two-week high, supported by geopolitical risks and persistent weakness in the US dollar.