JSE hits six-month high

The JSE all share index reached 60,000 points on Tuesday, its highest close since Cyril Ramaphosa became president on February 15.

The local bourse has been supported by a dovish stance from the US Federal Reserve and greater risk-on sentiment brought about by the lessening of global trade tension, with the US and Mexico having reached a trade agreement on Monday.

It was the ninth consecutive day of gains for the all share, which rose 3.8% last week, its best one-week performance since February.

The gains were boosted by an 11.26% rise in Naspers.

Unum Capital analyst Roberto Pietropaolo said the market seemed quite bullish. “There appears to be underlying strength, with the all share cruising higher despite a comeback in the rand.”

Technical analysis showed the top 40 is poised for a break above 54,000 points as the all share aims for its previous high of 61,776.70 points, reached on January 26, he said.

Rand hedges may be due for a recovery, with British American Tobacco down 14.7% in 2018 and AB InBev having broken into positive territory only over the past couple of weeks.

“However, markets are fickle and we are not totally out of the woods yet,” Pietropaolo said.

The rand still seemed oversold, he said. If it weakened again it could have a negative effect on banks and financials.

The all share is up 0.9% in 2018. This is despite losses of nearly 5% in March and 3.57% in May. The breakout by the all share from its range-bound trade is welcome news for investors, who have been losing money for most of 2018, with the weaker rand and the holiday season in the northern hemisphere not helping matters.