Share

JSE tracks global markets higher

Johannesburg - Global markets rallied on Wednesday morning to the highest level in two weeks, and investors on the JSE were willing participants.

European markets were also higher which boosted the local market, as most of the big capitalisation shares on the JSE which play a major role in moving indices are also listed on the London Stock Exchange.

The result was that the All-share index was already 1.04% higher at mid-morning on Wednesday, with the Top 40 index 1.28% firmer at 47 636 points. The strong performance by this index, which includes only the shares with the biggest market capitalisations, is an indication of where the action on the market was.

The Industrial index, with the biggest weight, was 1.05 % higher and the resources sector also lifted 1% as the big dual-listed commodity shares in London gained.

The surprise was the strong performance by financial shares, which at mid-morning were already 1.83% higher, although risk factors such as a possible South African credit downgrade, weak economic growth and the prospects of higher US interest rates have not disappeared. Banking shares were however globally among the biggest gainers, and the local banks followed.

Barclays Africa [JSE:BGA] was the biggest winner among the big local banks and lifted 3.26% to R148.75. FirstRand [JSE:FSR] was 2.9% higher at R43.50 and Standard Bank [JSE:SBK] was 1.31% up at R123.00

The rand also strengthened to R15.63 to the dollar as the US currency fell from a two-month high. The rand and the Korean won were the emerging market currencies which gained the most. This is not only good news for financial shares, but also for the resources sector.

READ: Rand firmer but vulnerable amid downgrade fears

Global equities rose to a two-week high after US housing data spurred optimism that the world’s largest economy can withstand higher interest rates. The MSCI All Country World Index advanced for a second day as futures indicated further gains in US shares.

Purchases of new homes in the United States surged in April to the highest since the startof 2008, bolstering the case for raising borrowing costs.

Investors seem be growing more comfortable with the prospect of higher US interest rates, with global stocks having regained levels seen before last week’s release of minutes from the Federal Reserve’s April meeting. The minutes fuelled expectations that the central bank will add to December’s interest rate increase.

Industrial sector attention in the JSE was on SABMiller [JSE:SAB] on Wednesday, on news that the world’s largest brewer Anheuser-Busch InBev [JSE:] gained European Union antitrust approval on Tuesday for its $100bn-plus acquisition of SABMiller, on condition that it sells off almost the whole of SABMiller’s beer business in Europe.

AB InBev has already agreed to sell SABMiller’s Peroni, Grolsch and Meantime beer brands to Japan’s Asahi Group Holdings Ltd and plans to divest SABMiller’s eastern European assets. The deal still needs to be approved by authorities in the United States and China. Australia and South Africa have already given it  their blessing.

SABMiller’s share price gainedonly  0.36% to R981.55, but the rice is now very close to the 52 week high of R986.41 set in January this year. The stock has been making steady progress lately and before Wednesday’s announcement was already almost 11% higher over the past 30 days.

AB InBev [JSE:ANB] traded 1.93% higher at R2 006.00. The share price reached a high of R2 023.64 shortly after its listing on the JSE in January, but then fell back as low as R1 758.00 The stock however regained 10.53% over the past 30 days.

The takeover will give AB InBev a third of the global beer market, selling twice as much beer as its nearest rival Heineken.
Naspers [JSE:NPN] at mid-morning was 1.39% higher at R2 214.77 while Richemont [JSE:CFR], which reached 52-week lows on the previous two days, traded 1.15% stronger at R91.23.

Sasol [JSE:SOL] performed strongly and gained R3.57 on news that the oil price was again back above $49 per barrel due to the weaker dollar. Sasol has rallied recently on the recovery of the oil price, and before Wednesday’s trade it was 10.3% higher over 30 days and 16.6% over 90 days.

In the resources sector, BHP Billiton [JSE:BIL] gained 1.58% to R190.40 and Anglo American Platinum [JSE:AMS] was 0.54% stronger at R139.73.

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
19.00
-0.3%
Rand - Pound
24.09
+0.1%
Rand - Euro
20.60
-0.0%
Rand - Aus dollar
12.37
+0.5%
Rand - Yen
0.13
+0.6%
Platinum
901.60
-0.1%
Palladium
998.41
-0.8%
Gold
2,153.87
-0.3%
Silver
24.93
-0.5%
Brent Crude
86.89
+1.8%
Top 40
65,642
-0.9%
All Share
71,879
-0.8%
Resource 10
52,855
-0.9%
Industrial 25
99,386
-1.1%
Financial 15
16,545
-0.5%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders