MARKET WRAP: JSE experiences Santa-Claus rally, albeit in light trading volumes

The JSE had a decent session on Monday, enjoying something of a Santa Claus rally, but trading volumes were light due to the summer holidays, with the market closing at noon.

The all share ended the trading session 1.27% higher at 52,081.10 points, ahead of the two-day Christmas break. The top 40 index climbed 1.43%, its biggest one-day gain in two weeks.

Industrial stocks did the heavy lifting on the day, supported by gold shares, which have enjoyed a solid run in December, albeit off a low base.

Naspers, MTN, Shoprite and Bid Corporation stood out among the larger industrial stocks which posted gains, amid signs of bargain-hunting.

Gold stocks continued their run — the index has gained 24% so far in December — supported by the recent pick-up in the gold price, which in turn got a boost from reduced expectations of higher interest rates in the US in 2018.

Banks and insurance stocks were marginally higher, held back, in part, by a weaker rand environment. Though recovering slightly on Monday, the local currency hovered near a two-month low against the dollar, at R14.54.

The weaker rand environment partially negates the net positive effect of lower international oil prices. Brent crude was relatively stable at $54 a barrel, having plunged to its lowest level in more than a year over the past week.

Global risk markets have endured a rough ride in 2018, hobbled lately by economic growth concerns.

The US stock market, which tends to set the tone for global markets, has lost $3-trillion in market value over the past three months, according to Bloomberg.

The JSE was on pace for its worst annual performance in a decade, according to Iress data, with losses in the all-share at 12.48% at Monday’s close. In 2008, in the midst of the global financial crisis, the index lost just over 25%.

On Monday, Anglo American was up 1.51% to R318 and Sasol 2.6% to R422. AngloGold Ashanti leapt 4.41% to R184 and Gold Fields 4.77% to R48.55, while Sibanye-Stillwater shed 4.25% to R9.02.

Naspers, which accounts for a fifth of the all-share value was up 2.65% to R2,956.30. 

MTN Group recovered 2.17% to R85.50 and Telkom 1.93% to R62.85.

Shoprite was up 2.08%, Steinhoff International 4.7% to R1.71 and Bid Corporation 2.43% to R262.

Reinet, an investment vehicle controlled by the Rupert family, regained 3.39% to R211. But British American Tobacco, which makes up the bulk of Reinet’s net asset value, lost 1.17% to R454.14. It is now down more than 45% in 2018.