JSE opens higher as risk-off sentiment abates and banks rebound

The JSE opened firmer on Monday in broad-based gains, with general retailers in the lead as the weaker rand boosted industrials and resources.

The market has its eye on the Reserve Bank’s interest-rate decision later this week, with no change expected.

Global themes affecting the local market include rising US bond yields and higher oil prices, and uncertainty surrounding US trade talks with China.

Naspers lifted 1% on positive Asian markets, as trade tension between China and the US eased. China has agreed to significantly increase its purchases of US goods and services, which should provide relief to investors, Nedbank Corporate and Investment Banking analysts reported.

The Dow closed flat on Friday.

The Nikkei 225 was up 0.31% on a widening Japanese trade surplus for April. Exports surged 4.6% over the month, while imports declined by 1.2%, resulting in the surge in the surplus.

Analysts said the rand was likely to remain under pressure until the dollar showed some signs of stabilising. The greenback has surged 2.35% against the euro in 2018, the best performance since 2016.

The rand weakened to R12.895 to the dollar at the opening from R12.7755 earlier.

Banks and retailers recovered after a heavy sell-off last week which saw banks lose 8.05% and general retailers 5.99% in risk-off trade after the dollar firmed to best levels so far in 2018 against the euro.

At 10.03am the all share was 1.19% higher and the top 40 was up 1.33%. General retailers had risen 1.61%, resources 1.53%, industrials 1.18%, the platinum index 1.13%, financials 0.95% and banks 0.79%.

Interim results released by Barloworld and Pioneer Foods came in as expected.

Barloworld rose 0.3% to R159.47 after reporting total headline earnings per share to end-March rose 32% to 481c. It guided for annual headline earnings per share (HEPS) growth of 25%-35%.

Headline earnings to end-March for Pioneer Food rose 30% to R592m, from an expected 22%-32%. Pioneer Food rose 1.49% to R107.

Steinhoff rose 2.78% to R1.85 after the conclusion of a presentation to lenders in London on Friday. The group undertook to tackle its huge debt overhang of about R150bn and would provide a further update on June 29 at the latest.

Steinhoff Africa Retail dropped 2.22% to R17.20.

Nepi Rockcastle gained 1.73% to R127.56.

Naspers rose 1.23% to R3,241.