JSE wrap | Financials lead surge amid consecutive gains

The JSE closed firmer for a second consecutive session led by strong gains from the financials index.

The financials index rebounded strongly following weakness in the prior session which was induced by the weaker rand and the downgrade of South Africa’s sovereign rating.

The local bourse managed to record healthy gains even as other major global markets struggled for direction. In Asia, the Hang Seng and the Shanghai Composite Index advanced 1.85{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} and 0.33{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} respectively, while the Nikkei retreated 0.88{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}.

The outlook was mixed for both Europe and the USA as investors tried to gauge whether the market had seen the last of the recent weakness. The rand also gained traction in today’s session as it peaked at a session high of R17.78/$.

At 17.00 CAT, it was trading 0.35{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} firmer at R17.85/$.On the JSE, MTN Group [JSE:MTN] closed amongst the day’s biggest gainers as it closed 19.19{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} higher at R48.39 following the issue of a no change statement. Sasol [JSE:SOL] issued a statement updating on its oil hedges as well as its response to the Covid-19 lockdown. This saw the share rocket 17.24{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} as it closed at R36.93.

Absa [JSE:ABG] also issued a no change statement which saw the share jump 18.48{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R75.00. Other financials stocks were bolstered by the firmer rand which saw gains being recorded for Nedbank [JSE:NED] which rallied 12.92{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R82.66, as well as FirstRand [JSE:FSR] which climbed 7.42{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R40.27. Gains were recorded for listed property stocks which saw stocks such as Hammerson [JSE:HMN] which rallied 15.45{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R16.96, as well as Growthpoint Properties [JSE:GRT] which surged 10.57{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R12.87.

Significant gains were also recorded for Discovery Ltd [JSE:DSY] which advanced 6.62{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R77.96, Old Mutual [JSE:OMU] which added 8.02{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R11.85, and Capitec Bank Holdings [JSE:CPI] which closed at R880.00 after rising 6.26{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}.Gold miners took a backseat in today’s session as declines were recorded for DRD Gold [JSE:DRD] which lost 8.98{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R10.24, and for Gold Fields [JSE:GFI] which fell 7.61{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R92.28.

Sibanye Stillwater [JSE:SSW] lost 6.08{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R22.57, while AngloGold Ashanti [JSE:ANG] closed at R319.11 after losing 5.63{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}. Sappi [JSE:SAP] was one of the day’s biggest losers after it fell 8.22{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R21.00, while Kumba Iron Ore [JSE:KIO] lost 1.3{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R280.06.

Losses were also recorded for Motus Holdings [JSE:MTH] which lost 5.56{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R27.20, Lighthouse Capital [JSE:LTE] which dropped 3.17{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to close at R6.10, and Pick n Pay [JSE:PIK] which closed at R60.60 after losing 1.54{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}.The JSE All-Share index closed 2.48{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} higher while the JSE Top-40 index gained 2.47{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}.

The Financials index was the biggest gainer of the day after jumped 7.03{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2}. The Industrials and Resources index gained 2.29{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} and 0.49{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} respectively.Brent crude was trading mostly flat as it was recorded trading 0.3{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} softer at $26.34/barrel just after the JSE close.

At 17.00 CAT, Gold was down 0.75{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} at $1609.61/Oz, Platinum was up 1.17{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} at $735.83/Oz, while Palladium had surged 4.79{e93887a69cdd95d753f466db084bbc3aa0067124675315461d28d68a72842cc2} to trade at $2436.61/Oz.

*Musa Makoni is a trading specialist at Purple Group