Chinese data boosts commodity currencies
SOUTH African stocks edged higher on Thursday ahead of the Women’s Day long weekend, lifted by strong gains from paper manufacturer Mondi and Northam Platinum as investors warmed to their upbeat profit growth.
Other mining companies rebounded from Wednesday’s losses after data showed that China’s exports and imports rose last month, easing fears of a waning appetite for resources by the world’s top commodities consumer.
China is South Africa’s largest bilateral trading partner and a major buyer of its minerals.
The benchmark Top 40 index rose 0.37% to 37 314 and the broader All Share index ended 0.35% higher at 41 747.
Mondi shares jumped 2.65% to R155 after it posted a 48% surge in first-half profit, propped up by the benefits of its recent acquisitions and strong demand for packaging paper.
Northam Platinum climbed 4.06% to R38.20 after it said its full-year headline earnings per share likely rose by between 60% and 70%.
The data from China helped to lift Anglo American Platinum, the world’s largest producer of the precious metal. It gained 2.44% to R356.50, and rival Impala Platinum added 1.63% to reach R99.50.
Fixed-line operator Telkom South Africa reached its highest close in 13 months, soaring 5.1%. Shares of Old Mutual extended gains to a second day, rising 2.27% to R31.10 after the insurer posted a 14% growth in half-year operating profit. Petrochemicals group Sasol was the biggest decliner on the blue-chip index, falling 1.48% to R470.32.
Trade volume was low as the bourse broke off for a three-day weekend. At least 132 million shares changed hands, according to JSE data. Advancers outpaced decliners at 162 to 114, with 61 stocks unchanged.
The rand gained nearly 1.4% against the dollar on Thursday, shrugging off weak local mining and factory output numbers as the better-than-expected Chinese trade data boosted commodity currencies.
The rand hit a five-day high of R9.77 to the dollar to its last trade at R9.95 to the dollar in New York on Wednesday. “The positive Chinese trade data overnight has weighed on [the dollar] and the disappointing local mining data has not caused much reaction,” said Tradition Analytics, referring to data that showed mining output fell 6.2% year on year in June.
The rand also took in its stride a report showing that growth in factory manufacturing output slowed to 0.4% year on year in June from 2.1% in May.
Government bonds gained in tandem with the local currency, pulling the yield on the 2026 bond three basis points lower to 8.17%, and that on the 2015 issue fell four basis points to 6.085%.
Gold gained nearly 3% to $1 312/oz on Friday after falling to a three-week trough earlier this week. Its recovery was helped by the dollar’s slide to a seven-week low.