MARKET WRAP: JSE boosted by optimism in global markets
Precious-metals miners remain under strain, amid a firmer rand, after feeling pressure from disappointing production data on Tuesday
Pressure on chemicals giant Sasol, as well as on precious-metals miners, failed to prevent the JSE from pushing higher on Wednesday, thanks to a strong showing by Naspers and banks.
Global markets had seemingly priced in UK Prime Minister Theresa May's defeat in the UK parliament on Tuesday night, analysts said, with the pound remarkably stable despite the scale of her loss.
May will now face down a no-confidence vote at 9pm South African time, although she is widely expected to prevail.
Brexit uncertainty has failed to sour the mood on global markets, analysts said, lifted this week by news of Chinese stimulus plans, as well as a recent shift by the US Federal Reserve to a more dovish stance.
Gains on the local bourse were extended in the afternoon, when US markets opened higher. US corporate earnings season has begun, with a number of companies expressing confidence about the health of the US economy, reported Dow Jones Newswires.
The all share rose 0.47% to 53,786.7 points and the top 40 lifted 0.6%. Gold miners lost 1.81%. Banks added 1.34%, and food and drug retailers 1.12%.
Earlier, data showed that retail sales grew 3.1% in November compared to the same month 2017, beating the Bloomberg forecast of 2% growth.
The figures point to some improvement on the demand side of the economy off a low base in the final quarter of 2019, Nedbank Group Economic Unit analysts said. However, the recovery on the production side remains slow and patchy — as evidenced by the weak November mining production statistics, released on Tuesday.
Naspers rose 1.96% to R3,042.14.
Sasol slumped 5.36% to R416.02, its worst daily loss in two months.
Rand Hedge AB InBev lost 3.32% to R969.18.
Ascendis Health gave up a further 6.21% to R5.59, having fallen 3.87% on Tuesday. On Monday, it had jumped 12.52% on news a buyer was interest in its Cyprus-based Remedica unit. Its key shareholder, Coast2Coast, has also reportedly been forced to sell shares due to margin calls.
Brait added 3.84% to R27.28, having gained 5.08% on Tuesday. It plunged 21.48% on Monday after saying it would cut its shareholding in New Look to between 18% and 30% by issuing shares to creditors.
Trading ex-dividend, Astral Foods lost 6.64% to R154.
Shortly after the JSE closed the Dow was up 0.56% at 24,133.17 points, while in Europe, the FTSE 100 had lost 0.36%. The CAC 40 was up 0.46% and the DAX 30 0.28%.
At the same time, gold was up 0.3% at $1,293.20/oz and platinum 0.76% at $804.97. Brent crude was 0.36% higher at $60.87 a barrel.
The rand was mixed as the JSE closed, 0.12% weaker at R17.6835/£, but 0.21% firmer at R15.6497/€. It was flat at R13.7302/$.