STOCKS AND MARKETS

SOUTH African stocks gained with global markets yesterday, lifted by a $2 trillion (R34.7 trillion) US coronavirus relief package and a higher gold price, while the rand fell ahead of a lockdown.

The blue-chip JSE Top40 index as well as the broader all share index gained 4.09 percent, led higher for a third consecutive day, with gold miners up 7.12 percent and financials 7.18 percent higher.

A Wall Street rally powered global gains in stocks as traders focused on the unanimous passage of the coronavirus relief bill in the US Senate and the possibility of more stimulus to come.

Spot gold gained after data showed US jobless claims surged to a record high due to the coronavirus pandemic, with Gold Fields shares

up 7 percent to R113.96 and AngloGold Ashanti 7.59 percent higher at R389.59.

President Cyril Ramaphosa said on Monday that South Africa, which has confirmed more than 900 cases of coronavirus, would be in lockdown from midnight yesterday to try to curb its spread.

Bonds firmed, with the yield on the benchmark paper due in 2026 down 28 basis points to 10.335 percent.

The rand was 0.14 percent weaker at R17.3540 to the dollar at 6.22pm, snapping a two-session rally that had driven the currency to R17.19, its highest level since Friday.

Meanwhile, emerging market (EM) shares and currencies were mixed yesterday with investors remaining cautious after two days of strong gains spurred by the announcement of massive monetary and fiscal coronavirus stimulus packages worldwide.

MSCI’s emerging market share index rose 0.6 percent as gains of between 2.6 percent and 10.3 percent in Indonesia, India and Philippines outweighed losses of up to 1 percent in China South Korea and Russia. Turkish stocks roe 0.4 percent. The EM stocks index rallied 11 percent during the previous two sessions, although losses of almost 25 percent this year to date are the biggest since the 2008 global financial crisis.

As more emerging economies go into complete lockdown to curb the spread of coronavirus, economic activity is slowly being brought to a standstill, making a deep recession more likely.

With the US dollar remaining weak, most Asian currencies capitalised, with those of India, Indonesia and Malaysia up more than 1 percent while the Chinese yuan rose 0.4 percent. I Reuters