MARKET WRAP: JSE closes firmer but gold miners see worst day in three months

The JSE closed firmer on Monday as global markets rallied after the US and China agreed to resume trade negotiations, while gold miners had their worst day since March. 

At a meeting during the G20 summit in Osaka, Japan at the weekend, US President Donald Trump and Chinese President Xi Jinping agreed to revive trade negotiations, which reached a deadlock in May. As part of the agreement, Trump said the US would halt the imposition of tariffs on Chinese goods and ease the ban on Chinese telecoms company Huawei.

Trump said Beijing had also agreed to buy unspecified farm products from the US. 

The trade truce was well received by global markets. By the close of the JSE, the Dow had gained 0.28% to 26,599.96 points and the S&P 500 earlier hit a record high of 2,977 points. In Europe, the FTSE 100 was up 1.1%, France's CAC 40 0.66% and Germany's DAX 30 1.18%. In Asia, the Shanghai Composite gained 2.22% and the Japan's Nikkei 225 2.13% while Hong Kong's bourse was closed for a public holiday. 

The rand reached its best level in three months during intraday trade at R14.03/$. Shortly after the JSE closed the rand had strengthened 0.13% to R14.0795/$, 0.51% to R15.929/€ and 0.53% to R17.8076/£. The euro was up 0.42% to $1,1313.

Gold had fallen 1.2% to $1,392.12/oz, as the US-China truce improved appetite for riskier assets. Spot gold had reached its best level in six years last week. Platinum had gained 0.49% to $838.07. Brent crude earlier gained 1.52% to $65.38 a barrel, as Opec and its allies look set to continue with supply cuts until the end of 2019. 

The JSE all share rose 0.46% to 58,472.50 points and the top 40 0.51%. Industrials and financials gained 1.09% and 0.16%, respectively. Gold miners slumped 5.64%,its worst day in over three months.

AngloGold Ashanti fell 6.78% to R236.79,  Sibanye 5.13% to R15.90, Gold Fields 4.63% to R73.20 and Harmony 3.88% to R30.51. 

Among financials, Liberty gained 2.51% to R108.31, Discovery 1.69% to R151.63, Sanlam rose 0.92% to R78.88 and Old Mutual 0.24% to R21.25.

Naspers climbed 2.92% to R3,519.20. 

Brait gained 3.35% to R19.12. The investment company said it would seek shareholder approval for a new equity ownership plan for its corporate advisers, Brait Advisory Services UK and Brait SA Proprietary.

Astral Foods jumped 5.72% to R163.88. The poultry producer has appointed former head of finance at Anglo American, Saleh Mayet and director for Oubos-Grootrivier Nature Reserve, Willie Potgieter as independent nonexecutive directors.

Earlier, the Absa purchasing managers’ index (PMI) rose to 46.2 index points in June from 45.4 in May. Total vehicle sales fell in June from 46,663 to 45,938 year on year. The eurozone's  producer price index for May and UK IHS Markit construction PMI for June are both scheduled for release on Tuesday.

mjoo@businesslive.co.za