JOHANNESBURG - STOCKS on the JSE extended their gains for the fourth session yesterday, briefly crossing the 69 000 index point mark amid continued optimism over a global economic recovery.
The FTSE/JSE All Share Index (Alsi) rose to 69 043 points during afternoon trade because of the risk-on sentiment after Moody’s skipped its scheduled review of South Africa’s sovereign credit rating on Friday.
At the close, the Alsi was at 68 377.23 points, down 0.21 percent, while the Top 40 Index was at 62 389.39 points, 0.29 percent lower. This is a far cry from when the Alsi fell to 37 900 points in March last year as Covid-19 wreaked havoc in the markets, before it rebounded to 67 000 points in February this year.
The JSE was yesterday buoyed by commodity prices, with Mintek and Kumba Iron Ore leading the pack after rising more than 7 percent and more than 4 percent, respectively, in intraday trade.
The prices of industrial commodities continued to reach multiyear highs as the economic recovery boosts demand for metals used in construction and manufacturing. Iron ore prices surged more than 10 percent past $200 (R2 809) a ton as China entered its peak construction season, while copper hit new record highs, boosted by reopening economies.
Meanwhile, the rand maintained its 16-month high of R14.05 to the dollar yesterday as it rose to pre-pandemic levels on Friday, boosted by prospects of a global economic recovery. By 5pm, the rand was bid at R14.01, up 7 cents from the previous day’s fix at the same time.
Citadel Global director Bianca Botes said the rand had benefited from the dollar’s weakness following weak job numbers for April.
“Friday’s lowerthan-expected US employment numbers sent waves through the markets,” Botes said. “This provided the catalyst the rand needed to stage a significant run against the dollar.”
The rand has made a spectacular comeback since it blew out when global markets panicked about the Covid-19 pandemic in March and April last year, falling to record lows against the dollar.
Investec chief economist Annabel Bishop said the perceived improved political environment had aided the rand to being 31.7 percent stronger yesterday from a year ago.
Bishop said although the rand was in a strong position, it had not recouped as much against the crosses as it had against the dollar. “The rand has battled to maintain its hold below the key resistance level of R14 to the dollar,” Bishop said.
BUSINESS REPORT