MARKET WRAP: JSE starts week higher as industrials rebound
The JSE ended a volatile trading session on Monday in positive territory as industrials and miners gained on the weaker rand, while gold shares retreated.
The JSE all share closed 1.54% higher at 51,615 points and the blue-chip top 40 gained 1.95%. Food and drug retailers rose 2.40%, resources 2.02%, industrials 1.93%, platinums 1.01%, financials 0.46% and banks 0.24%. The gold index shed 3.42% while property was flat.
Industrials were firmer on a strong performance from Naspers, whose share price jumped following an earlier subdued response to a trading update indicating an expected annual 4%-10% rise in headline earnings per share to end-March. Core headline earnings per share are set to rise between 33% and 39%. The share closed 3.88% higher at R2,594.91.
Sasol rose 1.84% to R369.56. Brent crude was 0.17% higher at $47.35 a barrel at the JSE’s close.
Rand hedge British American Tobacco jumped 3.23% to R919.90.
Barclays Africa lost 1.12% to R144.86 while Capitec jumped 3.5% to R782.50.
MTN added 1.13% to R111.66.
Trading was overshadowed by comments from Public Protector Busisiwe Mkhwebane on the independence of the Reserve Bank.
Resource and platinum shares experienced a recovery after slumping last week after the release of the latest iteration of the Mining Charter.
Analysts said the negative effects resulting from the charter had been priced into JSE-listed global mining companies, with the weaker rand an added bonus as most of their activities were offshore anyway.
After losing more than 2% at one stage on Monday, the rand was at R12.9458 to the dollar in early-evening trade. It fell to an intraday weakest R13.0558, before recovering after analysts said it was highly unlikely the Constitution would be amended to accommodate Mkhwebane’s recommendation.
The requirements for a constitutional change that would shift the Reserve Bank’s mandate from protecting the value of the rand in favour of the socioeconomic wellbeing of citizens was unlikely, Nomura’s emerging-markets investment economist Peter Attard Montalto said.
Bonds weakened in line with the rand with the benchmark R186 was last bid at 8.53% from 8.47%.
Futures tracked the stronger JSE. At 5.55pm‚ the local near-dated top-40 Alsi futures index was 1.81% higher at 45‚696 points. The number of contracts traded was 34,740 from Thursday’s 28‚504.
With Karl Gernetzky