JSE’s best day in more than month

The JSE had its best day in more than a month on Monday, firming alongside its global peers as hope that more economies will soon reopen boosted risk appetite. Global equities were higher on the day as the prospects of resuming economic activity and progress in finding a coronavirus vaccine lifted sentiment.

The JSE had its best day in more than a month on Monday, firming alongside its global peers as hope that more economies will soon reopen boosted risk appetite.

Global equities were higher on the day as the prospects of resuming economic activity and progress in finding a coronavirus vaccine lifted sentiment. According to reports, US drugmaker Moderna said results from its experimental vaccine are promising.

“In these uncertain times, I’m sure that optimism will be replaced with fear, which in turn will be replaced with promise and maybe even a sprinkling of exuberance repeatedly over the coming months only for the cycle to start again,” said Oanda senior market analyst Craig Erlam.

“Ultimately, it all depends on the second wave, when it rears its ugly head and how bad it is. Not to mention how far the testing, vaccine and cure has come along in the interim.”

While the reopening of economies has aided sentiment, International Monetary Fund MD Kristalina Georgieva said that it may take a while for the global economy to recover from the effects of Covid-19, Reuters reported.

Shortly after the JSE closed, the Dow had added 2.94% to 24,381.91 points. In Europe, the FTSE 100 was up 3.81%, France’s CAC 40 4.72% and Germany’s DAX 5.09%.

The JSE all share gained 3.53% to 51,382.06 points and the top 40 added 3.75%. Resources climbed 6.8% and platinum miners 9.46%.

Earlier, the Shanghai composite rose 0.24%, Hong Kong’s Hang Seng 0.58% and Japan’s Nikkei 225 0.48%.

The yield on the R2030 government bond fell 49 basis points to 9.1%. Bond yields move inversely to their prices. At 5.30pm, the rand had firmed 1.04% to R18.3674/$ and 0.47% to R19.9849/€, while it was flat at R22.4298/£. The euro had strengthened 0.6% to $1.0901.

“The performance of the rand over the coming week should be closely linked with global risk sentiment. Its fortunes for a stronger performance would be helped if data paints a picture that slightly eased lockdown restrictions worldwide are not leading to new waves of infections, as well as nations taking further steps to gradually reopen their economies,” said FXTM global head of market research and currency strategy Jameel Ahmad.

Gold was down 0.67% to $1,729.91/oz while platinum added 2.82% to $821. Brent crude was up 8.21% to $35.58 a barrel.