Retailers lead JSE ’ s advance

Retailers led the JSE higher on Monday as global markets firmed, with investors now turning their focus to the latest decision by the US Fed this week. The JSE all share gained 0.32% as retailers rose 1.96%. Cashbuild led the gains in its sector, up 4.19% to R277.14. TFG added 3.09% to R158.65.

Retailers led the JSE higher on Monday as global markets firmed, with investors turning their focus to the latest decision by the US Fed this week.

The all share reached its best close in nearly two weeks, tracking buoyant European markets as “investors bet that central banks will maintain their dovish stance, even as the economic recovery gathers momentum”, said Oanda market analyst Sophie Griffiths.

The JSE all share gained 0.32% to 67,941 points and the top 40 0.34%. Retailers rose 1.96%, industrials 0.7%, banks 0.54% and financials 0.56%. Precious metals fell 1.17% and resources 0.29%.

Cashbuild led the gains in its sector, rising the most since March 23, up 4.19% to R277.14. TFG added 3.09% to

R158.65, Steinhoff 2.63% to R1.95, Truworths 2.43% to R59.37, Woolworths 2.29% to R56.81 and Massmart 1.85% to R68.90.

Most analysts expect the US federal open market committee to keep rates unchanged at record lows, while details that might indicate the Fed’s plans to start tapering asset purchases soon, or even bring forward interestrate hikes, will be closely watched.

US inflation, which hit its highest level in 12 years in May on an annual basis, has been the theme in the markets so far in 2021, with the Fed reiterating that higher inflation would be transitory. The Fed is also expected to give an indication of how it sees inflation playing out in the coming months.

“All eyes are now turning to the Fed to see if they follow the European Central Bank’s (ECB) lead on Wednesday. Investors will be scrutinising the announcement and pursuant press conference for any signs the Fed is pivoting away from its stance that the current spike in inflation is temporary,” said Griffiths.

Last Thursday the ECB left its lending rate unchanged and confirmed it would continue with its accelerated bond-purchase programme.

The FTSE 100 closed 0.18% higher and France’s CAC 40 added 0.24%.

The rand weakened to an intraday worst of R13.8044/$, “negatively affected by the spike in Covid-19 infections in Gauteng, which showed a jump in new cases on Sunday”, the most since May 6, said Investec chief economist Annabel Bishop.

At 6pm, the rand had weakened 0.5% to R13.7433/$, 0.61% to R16.6651/€ and 0.68% to R19.3962/£. The euro had firmed 0.14% to $1.2124. tsobol@businesslive.co.za