JSE rebounds led by mining shares before US data

The JSE rebounded on Thursday after three straight sessions of losses, led by resources shares that received a boost from higher metal prices. Selected industrial stocks added to the momentum.

The all share was up 0.61% to 74,033.87 shortly before midday as the resources index recovered just under 1% 1.08%, paring the year-to-date losses to about 8.5%. Gold shares and platinum group metals rose 1.36%, trimming losses since the turn of the new year to 11.8%.

Naspers led gains in the industrial sector, which together with resources dominates the local market. Naspers was up 2.81% to just over R3,000.

Banks and the broader financial sector were mostly firmer, having held up well relative to the low expectations of economic growth to which their fortunes are closely tied.

The positive sentiment on the JSE was in step with global markets as investors await the release of US consumer inflation data in the afternoon. The data has important implications for the US Federal Reserve’s monetary policy, which has driven global market psychology for months.

“It hasn’t been the most lively start to the year but given how the last one ended, that was always a risk,” Craig Erlam, senior market analyst at Oanda, said in a note.

“Investors ended 2023 full of optimism and it was going to be difficult to keep that going early in the new year, especially with policymakers relentlessly pushing back at the idea of so many rate cuts.”

US headline inflation is expected to have risen at an annual rate of 3.2% in December, up slightly up from 3.1% in December. However, core inflation, which strips out volatile and energy times, is likely to have eased to 3.8% on an annual basis from 4% in November.

In commodity markets, Brent crude was up nearly 2% to $77.95 while palladium rose 0.72% to just over $1,000/oz.

The rand was on a stronger footing, gaining 0.19% to $18.6269/$, having weakened 7.7% in 2023.

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