JSE opens slightly firmer as banks gain in risk-on trade
The JSE opened marginally higher on Monday in choppy trade as banks and financials gained in risk-on trade following last week’s dovish message from the US Federal Reserve.
Asian markets were mixed after the Dow Jones closed at yet another record high on Friday.
The Dow was 0.39% higher at 21,637.74 points as the US second-quarter earnings reporting season surprised on the upside.
The Shanghai Composite was 1.43% off and the Hang Seng gained 0.26%. Asian data released in the morning indicated that Chinese second-quarter GDP rose 6.9%, compared with the 6.8% forecast.
"Domestic equities could exhibit further improvement today as the positive close in the US on Friday, a marginally up-tone in Asian markets this morning, a pick-up in global commodity prices and short-term momentum considerations created a supportive environment for risk assets," analysts at Momentum SP Reid said.
Resources were higher after the Chamber of Mines confirmed on Friday that Mineral Resources Minister Mosebenzi Zwane had given a written undertaking not to implement or apply the provisions of the 2017 reviewed Mining Charter pending judgment in the urgent interdict application brought by the chamber.
Spot platinum and gold prices were marginally higher, following a firmer Brent crude price hovering at $49 a barrel. Platinum added 0.07% to $922.46/oz and gold rose 0.18% to $1,230.41/oz.
The local market was eyeing Wednesday’s consumer inflation data for June, with a further drop in the consumer price index (CPI) expected, while the Reserve Bank will announce its interest rate decision on Thursday. No change is expected.
At 9.35am the all share was 0.14% higher at 53,673.30 points and the blue-chip top 40 rose 0.18%. Banks rose 0.67%, general retailers 0.42%, financials 0.39% and resources 0.33%. The gold index dropped 1.45% and platinum 0.56%.
Among individual shares on the JSE, Kumba Iron Ore rose 2.62% to R176.59 following an upbeat interim update on Friday with the iron ore producer expecting a rise in earnings of up to 50%.
Lonmin’s third-quarter production update pleased the market, with the share gaining 7.59% to R12.05. Lonmin said total refined platinum production rose an annual 3.9% to end-June.
Among banks, Standard Bank gained 1% to R153.82 and FirstRand 0.84% to R50.50.
Sanlam rose 1.20% to R67.40.
Woolworths was 0.56% down at R60.43 on a lukewarm trading update last week as comparable sales fell 0.9%.
Massmart lifted 1.36% to R106.71 and Shoprite 0.61% to R205.25.
MTN gained 0.84% to R122.72.
Naspers dropped 0.70% to R2,692.94.