South Africa stocks gain a third day amid trade hopes

South Africa’s main stock index advances for a third day, edging 0.1% higher by 9:55 a.m. in Johannesburg, as optimism about coronavirus treatments and signs of progress in trade negotiations boost demand for riskier assets.

Moderna said it’s near a deal to supply at least 80 million vaccine doses to the European Union. The US and China spoke about the phase-one trade pact on Monday, with the US Trade Representative saying both sides see progress and are committed to the success of the agreement.

“Markets seem to be more focused on the good news — in particular, that there appear to be multiple streams of progress towards treatment and the development of Covid-19 vaccines, as well as pretty positive feedback on trade discussions between the US and China,” Johannesburg-based Rand Merchant Bank said in a note to clients.

Luxury retailer Richemont rises for a second day, gains 0.3% to provide biggest boost to the index.

Index heavyweight Sasol extends gains to a fourth day, up 3.2% to the highest in more than a week, following strength in Brent crude oil prices.

Index of bank stocks rises for the third day as the rand advances to its strongest level since July 30.

FirstRand +0.9%, Investec +2.1%, Absa Group +0.6%, Capitec Bank Holdings +1.8%

Italtile +4.7% after reporting earnings.

Foreigners remain net sellers of South African stocks for an 11th day Monday, disposing of 644m rand worth of shares, according to bourse operator, JSE. This is the longest stretch of outflows since March.

© 2020 Bloomberg