Risk tolerance helps lift JSE higher
The JSE recorded broad-based gains on Tuesday, with banks and platinums bouncing back after a recent sell-off, although Capitec and Glencore posted sharp losses.
The rand was firmer on the day, as risk-on sentiment was given a boost by a political agreement in Germany over the migrant crisis in the EU.
A softer oil price supported shares that are sensitive to interest rates, although the JSE was lower for most of the morning as corporate news gave the market its initial direction.
Capitec faced reports that the Reserve Bank had requested a probe of its lending practices, sending that company’s share price 3.94% lower to R893. The Bank subsequently denied asking for a probe, but Capitec shares pared losses only slightly.
Diversified miner Glencore plummeted 8.57% to R58.54, following reports that its subsidiary in the Democratic Republic of Congo was facing a money laundering and corruption probe by US authorities.
US markets are closed on Wednesday for Independence Day, while investors are waiting for significant risk events later in the week. A decision by US President Donald Trump on further tariffs on China is expected, as are US nonfarm payrolls data for June.
Minutes from the US Federal Reserve’s June meeting could give the market some direction when they are released on Thursday, with analysts expecting a hawkish tone.
Volumes on the JSE were low at R13bn compared with the daily average of R24bn. The all share rose 0.58% to 57,488.8 points and the top 40 0.6%. Banks gained 1.42%, platinums 2.03% and food and drug retailers 1.71%.
Steinhoff International surged 31.39% to R1.80, as markets continued to digest the company’s unaudited interim results to end-March.
Clicks jumped 2.91% to R203.02 and Pick n Pay 2.08% to R78.09.
Grindrod Shipping Holdings jumped 11% to R160.95.
Astral Foods gained 5.02% to end the day at R293.49.
At 5.30pm, the Dow was 0.21% higher at 24,357.21 points, while in Europe the DAX 30 had gained 0.82%, the CAC 40 0.79% and the FTSE 100 0.53%. At the same time, platinum had surged 3.43% to $845.55 an ounce, and gold 1.17% to $1,255.90. Brent crude was 0.59% lower at $76.93 a barrel.