Little change on JSE after Fed comments

The JSE was little changed on Thursday, with global markets firmer as investors looked for clues in Federal Reserve chair Jerome Powell’s comments.

In his testimony on Wednesday before the House financial services committee, Powell indicated that the policy rate was at its “peak for this tightening cycle”, but emphasised that the Fed was not ready to begin reducing rates.

On the data front, the US labour department’s initial unemployment claims rose to 217,000. Claims were expected to hold steady at 215,000, unchanged from the previous week.

The data came a day before the closely watched nonfarm payrolls report due out on Friday.

Investors will be assessing the numbers for insights into the state of the labour market, which has shown resilience despite higher interest rates.

“Investors are seemingly settling for Powell’s slightly dovish comments that interest rate cuts will possibly come later in the year and that the Fed has indeed reached a peak in the current tightening cycle,” said SPI Asset Management partner Stephen Innes.

The JSE all share and the top 40 were little changed, with the former at 73,604 points. Industrial metals rose 3.19%, resources 2.82%, precious metals 2.46%, food producers 1.16% and retailers 0.27%. Financials lost 1.69%, banks 1.6%, industrials 0.37% and SA listed property 0.32%.

Tharisa led the gains in the industrial metals sector, rising the most in almost a month, gaining 4.22% to R12.34. Anglo-American added 4.14% to R443.39, African Rainbow 3.78% to R183.19, Glencore 1.63% to R95.46 and South32 1.15% to R37. According to Bloomberg, investor optimism was also boosted after the European Central Bank lowered forecasts for annual inflation and growth, while holding key interest rates steady, a move that can be taken as a positive signal on the international inflation front. At 6.10pm, the Dow Jones industrial average was 0.31% firmer at 38,780 points. In Europe, the FTSE 100 added 0.17%, France’s CAC 40 0.82% and Germany’s DAX 0.79%.

The rand gained for the fourth consecutive session on the day, touching an intraday best of R18.6663/$. At 6.23pm, the rand had strengthened 0.62% to R18.7083/$ and 0.29% to R20.45/€, while it was little changed at R23.9233/£. The euro was 0.29% firmer at $1.093.

Gold gained 0.34% to $2,155/oz and platinum 1.26% to $917/oz. Brent crude was 0.34% firmer at $82.95 a barrel.