JSE ends week on an upbeat note

THE JSE and rand ended the week on a positive note, supported by stronger global markets, as increased prospects of central bank stimulus around the world bolstered investor confidence.

The JSE was buoyant in the late afternoon on Friday at the end of a volatile week.

After trading 0.70% lower at midday, the all share index turned around before the close, with platinums rocketing on a firmer platinum price. At the close, the platinum price was up 2.2% to $1,049.59 a fine ounce.

Banks and financials pared earlier losses, as foreign selling subsided. The FTSE 100 stood to close at the best weekly level since 2011 after Bank of England (BoE) governor Mark Carney indicated that UK interest-rate cuts may be on the cards to boost market liquidity, in the wake of the major sell-off following the Brexit vote.

Markets are also now pricing in no further interest rate increases this year by the US Federal Reserve.

The JSE all share ended the day 0.27% higher at 52,357.50 points, and the blue-chip top 40 added 0.09%. The platinum index was 8.41% higher, the gold index gained 3.53%, and resources climbed 1.86%. Banks were 0.86% lower, and financials softened 0.1%. Industrials were off 0.14%.

After dropping 3.08% on Monday, the all share ended the week 1.31% firmer.

The Dow Jones was 0.34% higher at the JSE’s close. The FTSE 100 had gained 1.23%, and the Paris CAC 40 had risen 1.1%. The Dax was up 1.2%.

Momentum Investments macro research head Herman van Papendorp said the renewed stimulus talk came at a time the UK was likely to remain within the EU for at least two years, and possibly even longer.

“Political and economic uncertainty is likely to linger for some time,” he said.

As a result, UK businesses were likely to hold off investment and hiring, and thereby curb growth, Van Papendorp said.

In SA, a further 25 basis-point increase later in 2016 was still possible, but it was unlikely that the South African Reserve Bank would raise rates more aggressively against the backdrop of subdued local growth expectations, he said.

The rand had jumped more than 20c against the dollar in late afternoon trade. At 5.41pm‚ it was at R14.5011 to the dollar from R14.7314 at the previous close. It traded within a range of R14.51/$ and R14.80/$. It was at R16.3042 against the euro from R16.36 previously. With Ray Fauré