Donald Trump. Picture: REUTERS
Donald Trump. Picture: REUTERS

The JSE was on track for its best day in six months on Friday morning, as risk assets cheered the prospect of a trade deal between the US and China.

Multiple sources close to the talks said on Friday that a deal should be announced later on Friday, boosting Asian markets, with the local bourse following suit.

A deal could include delays to the imposition of US tariffs on China planned for Sunday, and it looked as if markets were about to see a major de-escalation in the trade war, said Oanda analyst Craig Erlam.

“While markets are trading higher on the back of these reports, there is an element of caution about the moves we've seen so far,” Erlam said, adding that some investors had previously been too eager to buy into trade-war optimism.

At 10.45am the all share was up 1.74% to 56,796.4 points while the top 40 had added 1.81%. Banks had added 2.47% and financials 2.41%.

Gold miners slipped 4.08%.

Gold was up 0.14% to $1,471.75/oz while platinum had lost 0.67% to $936.57. Brent crude was 0.71% higher at $64.80 a barrel.

The rand had pushed to a four-month high against the dollar, trading 0.53% firmer at R14.4176/$.

The pound was benefiting after the UK's Conservative Party secured the majority of votes in the UK general election, something analysts said reduced uncertainty regarding Brexit, and therefore the outlook for the UK economy.

“The pound has enjoyed its biggest surge in a decade on the hopes that a solid Conservative majority can finally end the Brexit deadlock,” said deVere Group CEO and founder Nigel Green.  

“With more political certainty due to the large majority, the UK economy is also likely to receive an election bounce,” said Green.

“Billions of pounds in business investment that has been on the sidelines due to the parliamentary paralysis is now ready to be unleashed. This will give a much-needed boost the slowing British economy”, he said.

Local counters exposed to the UK market were also benefiting, with Hammerson up 4.57% to R58.77 and Intu 4.85% to R6.92.

Diversified miner Glencore was up 4.05% to R44.42.

Naspers was up 2.87% to R2,134.52.

Tsobol@businesslive.co.za

gernetzkyk@businesslive.co.za

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