JSE, key global markets rejoice at Tory landslide

SOUTH African stocks rose on Friday, breaking three sessions of declines, with Harmony Gold among the top gainers after the miner narrowed its quarterly loss.

The bullion producer climbed 2.6% to R21 as its third-quarter loss halved thanks to a favourable exchange rate and cost cuts.

The benchmark Top 40 index was up 1.1% at 47 716, and the broader All Share index rose 1.04% to 53 790.

World bond and stock markets climbed after the business-friendly Conservative Party won Britain’s parliamentary election, leading to a rise in companies that share a London listing.

“We have a lot of dual-listed stocks, so if they rally in London, they are going to bring it down to our local market as well,” said Ronnel Zabora, a trader at Anglorand Asset Managers.

Investec plc rose 3.3%, beer maker SABMiller added 2.5% and British American Tobacco climbed 2.2%. Niveus Investments, which mainly has holdings in the gaming industry, ended 5.3% higher at R30 after reporting that full-year profit was expected to rise by up to 30%.

Among the decliners was Kumba Iron Ore, which fell 3.5% to R161 after flagging at least 20% lower first-half profit.

An April rebound in US jobs growth boosted Wall Street and supported the dollar, while the surprise Conservative victory cast away fears of a hung British parliament and sparked a rally in sterling and European stock markets.

Global bond markets recovered for a second day, focusing on weak aspects of the latest US jobs report, which may cause the Federal Reserve to be even more cautious towards ending its near-zero interest rate policy later this year.

The April US jobs data showed a solid 223 000 increase after a disappointing March, when hiring slowed sharply due partly to bad weather. The unemployment rate dropped to 5.4% in April, near a seven-year low.

The April hiring snapback, however, was less impressive after a further downward revision of March’s weak reading to 85 000.

In late-morning US trade, the Dow Jones industrial average was up 1.46% at 18 185.21. The S&P 500 was up 1.30% at 2 115.22, and the Nasdaq Composite was 1.29% higher at 5 009.52.

The FTSEurofirst 300 index of top pan-European shares jumped 2.7% to 1 589.72, with Britain’s FTSE 100 up 2%. Earlier, Tokyo’s Nikkei closed up 0.45%. The MSCI world equity index rose 1.35% to 439.13.

In the currency market, the pound reached a 10-week high against the dollar following the UK election result. It was last up 1% at $1.5396. Brent crude was last down 57c, or 0.8%, at $64.99 a barrel and spot gold prices rose 0.07% to $1 185.15/oz. —