The JSE opened firmer on Monday as subdued‚ risk-on trade dominated following Friday’s US nonfarm payroll data that led the market to believe the Federal Reserve was unlikely to hike rates in September.
Trading volumes were thin on US Labor Day and traders expected a subdued day with little liquidity.
The US jobs report showed that 151‚000 jobs were created in August‚ fewer than the expected 180‚000‚ fuelling risk-on trade as the Dow Jones gained 0.39% on Friday. Asian markets were higher on Monday as the Nikkei 225 gained 0.66% and the Hang Seng rose 1.68%.
The dollar has also remained largely flat‚ which is supportive of further risk-on trade and higher commodity prices. The Brent crude price was up 2.47% at $47.75 a barrel in early morning trade.
At 9.30am‚ the all share was 0.69% higher at 53‚869.60 points and the blue-chip top 40 added 0.76%. The gold index rose 2.12% and platinums firmed 2.07%. Resources added 1.77%. Banks firmed 1.40%.
Barclays Research said in a note that global markets still lacked direction. It added that markets had been calmer over the past few months during the northern hemisphere summer‚ but incoming signals on the global economy were mixed.
This left the policy outlook uncertain. “For example‚ last week’s softer US employment data make our call for a September US Federal Reserve hike a very close one‚” Barclays said.
Europe’s political challenges remained high‚ Barclays said‚ with Spain failing to form a government‚ and this weekend’s Group of 20 (G-20) summit seemed unlikely to yield meaningful policy initiatives.
Among individual shares on the JSE‚ Anglo American rose 2.39% to R158.44.
Kumba Iron Ore added 2.24% to R137.
Among gold stocks DRD Gold lifted 4.15% to R8.04.
Standard Bank was 2.26% higher at R138.72.
Alexander Forbes rebounded 4.07% to R6.65.
Hyprop was 0.41% higher at R123.50. Last week it declared a total distribution of 619.9c per share for the full year‚ up 14.2% from the previous year. — TMG Digital/BDlive