JSE rises on fresh trade optimism
The JSE rallied on Friday ahead of an expected pronouncement by Moody’s Investors Service on SA’s credit rating and on renewed trade optimism between the world’s two largest economies, China and the US.
The JSE rallied on Friday ahead of an expected pronouncement by Moody’s Investors Service on SA’s credit rating and on renewed trade optimism between the world’s two largest economies.
Hopes for a new round of trade talks between the US and China overshadowed lingering worries that the global economy is slowing. Reuters reported that China had made “unprecedented proposals”, including on the transfer of technology, in its talks with the US.
US treasury secretary Steven Mnuchin said in a tweet on Friday that he and US trade representative Robert Lighthizer had concluded “constructive” trade talks in Beijing. Discussions between the two sides are expected to continue As it turned in Washington out, Moody this ’week. s decided not to release a report on SA’s sovereign credit rating. The agency rates SA’s debt Baa3, one notch above junk status, with a stable outlook.
The JSE all share rose 0.72% to 56,462.6 points while the top 40 was up 0.74%. Platinums gained 1.04% and banks 1.41%, while resources gave up 0.22% and gold miners 0.96%.
JSE heavyweight Naspers was 0.85% higher, closing at R3,332.14 after earlier reaching its best level in about seven months, of R3,363.75.
EOH Holdings fell another 9.25% to R10.40, as the market continued to digest the implications of the company’s loss of its Microsoft contract.
Lewis slumped 4.31% to R31.10 and Nampak retreated 6.03% to end the day at R11.22.
But Murray & Roberts climbed 8.1% to R14.28 and Woolworths was up 5.06% to close at R46.48.
Despite trading ex-dividend, Old Mutual gained 2.68% to R21.87 after CEO Peter Moyo said in the company’s annual report it was confident it would reach its medium-term targets, despite fragile investor confidence.
This week, local data will show the preliminary results of revenue collection for 2018/2019, which the Treasury expects to show a shortfall of R42.8bn, while the Absa purchasing managers’ index, which gauges activity in the manufacturing sector, is expected to reflect a depressed mood as power cuts dent production.
Despite having weakened significantly through the week, partly because of the Turkish lira’s decline, the rand made something of a comeback on Friday. At 5.05pm, fighting jitters ahead of Moody’s announcement, it had strengthened 0.93% to R14.4733/$. It was up 0.91% to R16.2483/€ and 1.22% to R18.8239/£.
Shortly after the JSE closed, the Dow was up 0.31% to 25,804.66 points, the FTSE 100 had added 0.55%, the CAC 40 0.82% and the DAX 30 0.81%. At the same time gold had gained 0.37% to $1,294.93/oz and platinum 0.5% to $844.57. Brent crude was 0.75% lower at $67.46 a barrel.