MARKET WRAP: JSE caps worst month in 10 years with a 3% jump

The JSE saw its best performance in five months on Wednesday, lifted by a 9.4% surge by Naspers to R2,592.68.

A decision by global index firm MSCI not to penalise Naspers for having dual share classes helped buoy the company's share price, but a strong performance by associate Tencent also contributed.

Facebook’s third-quarter results on Tuesday night were better than expected, which has encouraged buyers of social media stocks around the world, said Vestact's Paul Theron. "Tencent flew up by nearly 6%. It’s had a shocking year so far, so it’s about time it went up for a change."

Naspers is down 24.87% so far in 2018.

Gains by banks earlier were erased after significantly disappointing trade balance figures for September prompted a slide in the rand. SA posted a R2.95bn trade deficit in September, for worse than market expectations of a R4bn surplus.

The trade balance could weaken further due to trade conflict issues, a weaker rand and rising costs of imports, said Investec economist Lara Hodes.

The all share firmed 3.22% to 52,388.9 points and the top 40 3.61%. Platinums jumped 7.05%, industrials 4.4% and resources 3.99%.

Asian and European stocks were all firmly up on Wednesday, with the Dow opening more than 1% higher.

Positive earnings results from US companies, and comments from US President Donald Trump expressing optimism that a trade deal could be reached with China helped improve sentiment this week.

October, however, was also a tough month for many global equity markets, with tech stocks in particular under pressure.

Locally on Wednesday, diversified miner Glencore gained 6.1% to R60.32, Anglo American 4.85% to R315.63 and BHP 4.75% to R296.86.

Rand hedge Richemont jumped 4.42% to R107.94 and AB InBev 1.65% to R1,101.60.

DRD Gold fell 1.06% to R3.74, after earlier reporting in a quarterly operations update that its production was within guidance for the 2019 financial year.

Sanlam gained 3.28% to R74.26, after announcing earlier that it would embark on a new empowerment scheme, which will see it sell 5% of its issued shares to new and existing broad-based BEE shareholders.  The proposed deal is worth between R7.4bn and R8.6bn.

Pepkor firmed 2.3% to R18.25 and Shoprite 2.03% to R180.30.

Shortly after the JSE closed the Dow was up 1.45% to 25,235.4 points, while in Europe, the FTSE 100 had gained 1.74%, the CAC 40 2.55% and the DAX 30 1.71%.

At the same time platinum was up 0.35% to $838.03 an ounce, while gold had lost 0.64% to $1,214.94. Brent crude was 0.23% lower at $76.07 a barrel.

gernetzkyk@businesslive.co.za