JSE claws back week’s earlier fall

The JSE ended the shortened week on a firm note as the all share recovered from Thursday’s fall of more than 2%.

Industrials, led by Naspers, rebounded on renewed risk-on sentiment, with the Dow up 1% soon after the JSE’s close. The Dow followed in the footsteps of European markets, which benefited from a weaker euro.

Banks were the top performers, but gold and platinum stocks found little attention on the resurgent dollar.

US employers added 162,000 jobs in April, less than the 192,000 expected by economists in a Trading Economics consensus forecast. This could mitigate a more hawkish stance from the US Federal Reserve, which kept rates unchanged at its Wednesday meeting. The stronger dollar, however, was indicative of the market view that the Fed might hike rates more aggressively in 2018.

The all share closed 0.65% higher at 57,648.90 points and the top 40 added 0.92%. Industrials rose 1.23%, banks 0.81% and resources 0.26%. The gold index lost 2.72%, the platinum index 1.6%, and food and drug retailers 1.1%.

The all share ended the week 0.34% up, but is down 3.12% for the year to date.

Naspers closed 4.88% higher at R3,019.33, ending a choppy week with a gain of 0.81%.

The rand was off its weakest levels of the day at the JSE’s close and was trading unchanged from opening levels at about R12.5860/$ after weakening to R12.6836 in the day.

On Wednesday, the Fed gave little away about future policy moves, but the market is pricing in four increases in 2018, instead of the three that had been expected previously.

The euro was at $1.1926 from $1.1988, which was its worst level since early January.

Local bonds were weaker, with the R186 bid at 8.34% from 8.28%. The US 10-year was last at 2.952% from 2.9481%. Earlier, US bond yields slid after eurozone inflation for April came in lower than expected, challenging the view of some investors that improved economic growth and rising inflation will soon lead to much tighter monetary policies outside the US.

The top 40 Alsi futures index rose 0.89% to 51,270 points. It ended the week 0.11% up. The number of contracts traded was 19,867 from Thursday’s 28,282.