Retail stocks rally as JSE edges higher

May 19 2017 18:15
Martin Harris, EasyEquities
Cape Town – The JSE closed higher as international markets recovered losses sustained during the Trump panic on Wednesday.  

The general retail index managed to recover 1.97% on the back of positive consumer sentiment and firmer rand.

The rand traded 22 cents firmer at R13.22 to the dollar at the close of the JSE compared to Thursday.

The blue-chip Top 40 traded 0.40% firmer, while the All-share index climbed 0.42%. The industrial index led the rally, closing 0.63% in the green, followed by the resources index 0.51% and gold miners 0.17%. Banks closed 0.37% higher, while the broader Financials Index closed 0.19% lower.

Steinhoff [JSE:SHF] emerged as the ALSI Top 40 market winner for Friday, with the share closing at R73.30, as investors reacted strongly to news that the international retail group plans to unbundle its retail interest in Africa and list them separately. The African asset listing will include Pepkor, furniture chain JD Group and Tekkie Town.  

Crude Oil firmed 2.09% to $53.61/bbl following on growing expectations that Opec will extend output cuts to curb a persistent glut in inventories. Since the start of March, the Brent price has swung from more than $56 a barrel to less than $47 as opinion swayed over whether cuts by the Organisation of the Petroleum Exporting Countries and other producers will offset rising US output.

Gold prices edged higher on Friday to $1 255/Oz as investors sought to remain cautious amid the ongoing concerns over political turmoil in Washington.

Safe-haven demand was boosted following reports this week that US President Donald Trump asked former FBI Director James Comey to end the agency's investigation into ties between former White House national security adviser Michael Flynn and Russia.

The US dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.15% at 97.62, just off Thursday’s fresh six-month lows of 97.28.

A weaker US dollar usually supports gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies.

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