The JSE hit another fresh all-time high yesterday, with the All-Share Index advancing above 84 000 index points for the first time, mainly pushed up by gold miners, with bullion hovering at record levels.
Stocks at the JSE were buoyed by Sibanye-Stillwater surging 3.9% while Harmony Gold, DRDGold, Gold Fields, and AngloGold Ashanti rising between 2.7% and 3.6%.
The gold price was holding steady above the $2 500 level while the oil price slipped with the easing of geopolitical tensions in the Middle East, along with ongoing demand concerns out of China were weighing on the price of oil.
Sasol fell the most by 6.2% after it reported a R44 billion loss for its latest financial year ended June 30, the first since 2020 amid a challenging economic environment and a massive R75bn impairment.
Market sentiment continued to be supported by expectations that the US economy will dodge a recession, and cooling inflation will spur interest rate cuts soon. Meanwhile, traders are keeping an eye on economic data from several economies, alongside corporate earnings.
The focus now turns to upcoming inflation data due on Wednesday for hints on the future interest rate path.
The rand gained further ground before running out of momentum to trade above R17.80 to the US dollar.
It came after the rand’s strong run this week as it closed at the day’s best level of R17.69 to the greenback on Monday, on the back of the weaker dollar and positive risk sentiment.
Meanwhile, the composite leading business cycle indicator in South Africa fell by 0.4% month on month in June, following a 1% decline in May.
This marked the second consecutive month of decreased economic activity, driven largely by declines in five of the seven component time series, which outweighed the improvements in the other two.
The South African Reserve Bank (Sarb) said major negative factors included a reduction in approved residential building plans, and a narrowing of the interest rate spread.
Conversely, the only positive contributions came from increases in the six-months smoothed growth rates of the real M1 money supply, and the number of new passenger vehicles sold.
Investec chief economist, Annabel Bishop, said with load shedding suspended, economic data improved in the second quarter, from manufacturing and electricity production to wholesale and retail trade sales, the economic transaction indicator from BankservAfrica, and building completions.
“However, Transnet’s insufficient freight capacity remains a hindrance to faster growth. The Presidency notes energy and logistics have been the largest constraints on economic growth over the past few years,” Bishop said.
“Tansnet has said it has appointed its original equipment manufacturers (OEM) to refurbish and service its rail locomotives and supply port equipment, albeit reportedly the latter would arrive only in a year-and-a-half’s time,” she pointed out.
BUSINESS REPORT