MARKET WRAP: JSE closes higher on late rand rally

The JSE closed higher on Friday, but lower for the week, with local stocks expected to continue to be battered by trade concerns in coming sessions.

The local bourse closed higher on Friday, ending the week flat, as a late rand rally resulted in broad-based gains. This followed a disappointing US non-farm payrolls report, which weighed on the dollar.

The all share gained 1.15% to 57,118 points and the top 40 1.29%. Banks gained 1.58%, and food and drug retailers 1.74%. The local bourse edged 0.08% lower in the week.

The rand should give direction to the bank index in the coming week. The sector could also move in concert with corporate earning reports.

Absa will release its interim results to end-June on Monday, followed by Nedbank’s full-year results on Tuesday. The former rose 2.37% to R171.26 on Friday. In the prior interim period, it reported normalised headline earnings growth of 7% to R7.7bn.

Nedbank lifted 1.6% to R268.27.

Locally, data indicating the health of the manufacturing sector for the last month of the second quarter is due on Tuesday. A Bloomberg consensus forecast is for manufacturing to have risen 2.2% year-on-year in June, from May’s 2.3% rise.

Also on Tuesday, Argentina’s central bank is expected to keep interest rates on hold at a whopping 40%. Any deviation from this could spill over into the rand.

Volumes may drop off towards the end of the week, with markets closed on Thursday for Women’s Day.

In the US, earnings season has begun to wind down, with approximately 43 S&P 500 companies scheduled to release results next week, said FNB Securities analysts.

Glencore gained 0.68% to R55, ahead of its interim results on Wednesday. The diversified miner said on Tuesday that it expects full-year production to be largely in line with the guidance it gave at the beginning of its financial year.

Shortly after the JSE closed, the Dow was up 0.26% to 25,392.45, while in Europe the FTSE 100 was up 1.05%, the DAX 30 0.49% and the CAC 40 0.32%.

At the same time, platinum had risen 1.97% to $840.70 an ounce and gold 0.95% to $1,219.24. Brent crude was flat at $73.33 a barrel.

The top 40 Alsi futures index firmed 1.22% to 50,910 points, ending the week 0.54% lower. The number of contracts traded was 15,792 from Thursday’s 20,905.