Resources rally keeps JSE buoyant
The JSE, rand, bonds and futures were all firmer on Tuesday as resource prices rose, while the Constitutional Court case on a vote of no confidence in President Jacob Zuma unfolds.
The rand and bonds have suffered as a result of recent moves by Zuma, which began with his recall of former finance minister Pravin Gordhan from an international investor road show. Gordhan and his deputy, Mcebisi Jonas, were axed in a subsequent cabinet reshuffle, which resulted in SA being dropped to junk status by two of the world’s largest ratings agencies.
In a motion brought before the Constitutional Court by the United Democratic Movement (UDM), the court has asked for affidavits from opposing parties. The UDM is requesting an order for a vote of no confidence in Zuma by Parliament to be decided by secret ballot.
Improving commodity prices boosted the rand and mining shares, with the JSE all share closing 0.74% higher at 53,535.20 and the blue-chip top 40 adding 0.72%.
The gold index rose 4.22% and platinums 3.18%. Banks climbed 1.65%, general retailers 1.35%, financials 1.36%, food and drug retailers 1.19% and industrials 0.71%.
In early evening trade, the gold price had added 1.04% to $1,267.12 an ounce and platinum 1.73% to $953.90.
“The JSE is well positioned to weather the downgrade storm as it is a global index,” said Old Mutual Multimanagers analyst Izak Odendaal.
Anglo American shed 0.96% to R209.96, while British American Tobacco added 0.96%, to R930.37.
Diversified miner Exxaro was off 2.35% to R124.88, while Gold Fields added 3.23% to R52.35 and Impala Platinum added 4.14%, to R49.84.
By early evening trade, the local currency had strengthened to R13.7595/$ from Monday’s R13.9404. The benchmark R186 bond had firmed to 8.95%, from a previous 8.99%.
Futures tracked the firmer local bourse, with the near-dated top 40 Alsi futures index 0.8% higher at 47,470 points.