JSE bounces a little after bloodbath

The JSE closed firmer yesterday, taking its cue from positive global markets, after a slump in oil prices triggered the worst sell-off since the 2008 financial crisis on Monday.

Global stocks were hit by the twin blows of Covid-19 and oil prices collapsing on Saudi Arabia’s price war with Russia.

Investors are now placing their hopes on economic stimulus measures aimed at bolstering the global economy.

On Monday, US President Donald Trump said he would be taking major steps to prepare the US economy for the effect of the coronavirus, while Japan’s government plans to spend more than $4bn (R63.9bn) in a second stimulus package to cope with the fallout from the virus.

“A co-ordinated response will be required from monetary and fiscal authorities around the world to restore confidence in the markets,” Oanda senior market analyst Jeffrey Halley said.

“It is also important to realise that any moves made will not be a magical panacea to the ills sweeping the globe.

“They can only mitigate the situation, not make it go away.”

Yesterday, oil prices jumped by about 8% after the biggest rout in nearly 30 years, as Russia

signalled that talks with oil cartel Opec remained possible.

Reuters reported yesterday that Russian energy minister Alexander Novak did not rule out joint measures with Opec to stabilise the market, adding that the next Opec+ meeting is planned for May or June.

But in response, Saudi Arabia’s energy minister, Prince Abdulaziz bin Salman, told Reuters he did not see a need to hold an Opec+ meeting in

May or June if there is no agreement on what measures should be taken to deal with the effect of the coronavirus on oil demand and prices.

The JSE all share ended 1.32% higher at 49,466.01 points and the top 40 gained 1.29%. Industrials were up 1.73%, banks 1.85% and financials 1.68%.

Gold miners dropped 7.7% and the platinum index 2.52%.