JSE higher, focus on central banks

The JSE had its sixth day of gains on Monday, its longest winning streak since January, as global investors cheered developments in the hunt for a Covid-19 vaccine, while focus will move to central banks later this week.

British-Swedish drugmaker AstraZeneca said at the weekend that it had resumed its phase-three vaccine trial in the UK. US pharmaceutical giant Pfizer CEO Albert Bourla said the group would know by end-October if its vaccine experiment with German company BioNTech was effective.

AxiCorp market analyst Milan Cutkovic said: “There are still plenty of uncertainties, and developing an effective vaccine is a long-term process. “However, investors are reacting positively to every [bit of] progress made in the fight against Covid-19.”

The JSE all share firmed 0.43% to 56,327.05 points and the top 40 0.51%. Resources gained 0.80% and gold miners 3.02%. The all share is down 1.33% so far this year, according to Infront data.

At 5.38pm, the rand had firmed 0.36% to R16.6744/$ and 0.12% to R19.8057/€, but it had weakened 0.12% to R21.4877/£. The euro had strengthened 0.29% to $1.1879.

“The rand’s positive performance continues to highlight how it remains influenced by external forces, rather than the developments at home,” said FXTM senior research analyst Lukman Otunuga.

Otunuga said if the rand kept drawing strength from Covid-19 vaccine hopes it could head for R16.50/$ before the Reserve Bank’s repo rate decision on Thursday. Analysts say another rate cut may be on the cards. The US Federal Reserve, the Bank of England and the Bank of Japan are due to announce interest-rate decisions.

Soon after the JSE closed, the Dow was up 1.30% at 28,024.76 points. In Europe, the FTSE 100 was down 0.10%, France’s CAC 40 added 0.35% and Germany’s DAX was flat.

Earlier, the Shanghai Composite rose 0.57%, Hong Kong’s Hang Seng 0.56% and Japan’s Nikkei 225 0.65%.

The yield on the R2030 government bond had fallen eight basis points to 9.28%. Bond yields move inversely to prices. Gold added 1.07% to $1,960.62/oz and platinum 3.11% to $956.85. Brent crude lost 0.63% to $39.54 a barrel.