JSE opens higher amid optimistic trade in Chinese markets

The JSE started the week on a high note as industrials jumped after Chinese authorities said they were contemplating further stimulatory measures to boost the economy following disappointing growth numbers.

Local retailers and banks gained on a firmer rand, trading at R14.2917 to the dollar from R14.4488.

Chinese markets were booming on Monday morning, supported by hopes of further easing measures from the central bank, FxPro analysts said.

“However, the risks associated with developments in Saudi Arabia, Brexit and the Italian budget constrained US and European markets,” they said.

China’s GDP growth increased 6.5% in the third quarter, down 0.2% compared to the 6.7% the country posted in the previous quarter – representing the slowest level of economic growth since the global financial crisis in 2008.

However, over the weekend officials from the Chinese central bank and various other state institutions resolved to support the country’s private sector, which has the full support of President Xi Jinping.

Local market focus is on Wednesday’s medium-term budget policy statement by newly appointed finance minister Tito Mboweni. 

Mboweni has his work cut out for him in having to stay the course of measured fiscal consolidation while trying to stimulate economic growth, said FNB chief economist Mamello Matikinca.

“That will prove a difficult task,” she said.

The Dow closed 0.26% higher on Friday. The Shanghai Composite jumped 4.09% and the Hang Seng 2.14% on Monday.

At 9.38am the all share was 0.55% higher at 52,379.20 points and the top 40 gained 0.59%. General retailers rose 1.16%, industrials 1.14%, banks 0.73% and financials 0.4%. Platinums shed 0.54% and resources 0.43%.

BHP was 0.7% lower at R290.35.

Sasol slipped 0.16% to R507.50.

Impala Platinum was 4.83% lower at R24.42 and Anglo American Platinum 0.87% to R465.

Standard Bank climbed 1.61% to R164.08 and Absa 1.15% to R148.35.

Sanlam was up 2.1% to R73.04 and Discovery 1.84% to R154.60.

Woolworths rebounded 3.19% to R49.19 and Shoprite 1.63% to R190.70.

Naspers gained 2.51% to R2,791.36.

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