MARKET WRAP: JSE closes firmer in broad-based gains
The rand was 0.75% stronger to the dollar at the close; from April to June retail sales rose by 2.2%, which might help pull SA out of recession
The JSE closed firmer on Wednesday, with Naspers boosting market sentiment on a strong second-quarter showing from Hong Kong-listed Tencent, of which it owns a third.
After gaining more than 4% in intra-day trade, Naspers closed 2.93% higher at R2,887.15. Tencent reported that revenue rose 57% for the six months to June, and gross profits 38%.
Naspers’s share price has gained 43% so far this year while Tencent is up more than 70%.
The all share ended the day 1% higher at 55,534.60 points and the blue-chip top 40 rose 1.14%. Resources firmed 1.4%, industrials 0.97%, banks and financials both 0.86%, property 0.53% and the platinum index 0.32%. Gold shares dropped 0.37%, and food and drug retailers 0.21%.
General retailers ended the day flat after retail sales data released earlier indicated a modest monthly 0.2% rise in June, while the year-on-year gain was 2.9%.
"Very encouragingly, in the three months from April to June retail sales rose by a substantial 2.2%, which should help boost the GDP-growth estimate for the second quarter, helping pull SA out of recession," said Stanlib economist Kevin Lings.
Global diversified miner Glencore gained 3.24% to R58.61 and Anglo American 3.18% to R219.01.
Kumba Iron Ore closed 5.56% lower at R185.44 as iron ore prices fell to three-month lows. The losses may have been compounded by the share trading ex-dividend, after the company recently declared its first payment to shareholders since 2015.
Sasol gained 0.95% to R399.91 as Brent crude slipped 0.44% to $50.89 a barrel.
In banks, FirstRand rose 1.1% to R55.20, Standard Bank 0.62% to R163.87, and Barclays Africa 0.52% to R149.68.
The rand was 0.75% stronger to the dollar at the JSE’s close, firming to R13.1941 from Tuesday’s R13.3216. The euro was at $1.1703 from $1.1758.
The bond market strengthened following the release of Moody’s regular update on the South African economy. Although the ratings agency kept its outlook at negative, it did say the South African government’s credit profile was supported by the economy’s relative size and diversification, sound macro-economic policy and fiscal management, and deep financial markets.
The benchmark R186 was last bid at 8.54% from 8.59% previously. US bonds were stronger with the yield on the 10-year bond at 2.2553% from 2.2737%.
The top-40 Alsi futures index was 0.97% higher at 49‚071 points. The number of contracts traded was 21,846 from Tuesday’s 20‚424.