JSE ends the week up 2.31%

The JSE closed firmer on Friday as global markets recovered from a sharp sell-off at the start of the week, which was sparked by concerns that the Delta variant of the coronavirus will delay the global economic recovery. After losing 2.59% on Monday, the JSE rose every day thereafter, bringing its gains for the week to 2.31%.

The JSE closed firmer on Friday as global markets recovered from a sharp sell-off at the start of the week, which was sparked by concerns that the Delta variant of the coronavirus will delay the global economic recovery.

After losing 2.59% on Monday, the JSE rose every day thereafter, bringing its gains for the week to 2.31%. The biggest winners for the week were industrial miners, retailers and industrials, which added 4.68%, 2.66% and 2.47%, respectively.

“Monday’s ‘Delta-dip’ receded further into the rear-view mirror as markets looked content to ride out Friday with a no-further-bad-news-is-goodnews rally,” said Oanda senior market analyst Craig Erlam. “That same theme should ensure the markets finish in much the same manner.”

The all share gained 0.98% to 68,063 points and the top 40 added 1.02%. Industrial metals were up 1.98%, resources 1.47%, banks 1.12% and financials 0.95%.

Shares in hotel operator City Lodge closed at their highest level in more than a month after the company said it had reached agreements worth R142m to sell its hotels in Tanzania and Kenya. It said the proceeds from the sale of three hotels in Kenya for R141m, and one in Tanzania for R1m, will be used to reduce interest-bearing debt, which stood at R530m at the end of December 2020.

The company’s shares leapt 6.81% to R3.92.

The rand extended Thursday’s losses after shedding more than 1% when the Reserve Bank warned that the civil unrest and violence had prevented it from improving its expectations for the country’s economic recovery. The Bank kept its 2021 GDP growth forecast at 4.2%, but revised up its inflation expectation for the year to 4.3%, from 4.2% previously.

In his speech on Thursday, Bank governor Lesetja Kganyago said he did not expect the economy, which shrank 7% and lost about 1.4-million jobs in 2020, to return to pre-pandemic levels before 2023.

“The decision to keep rates unchanged was widely expected. However, the governor’s comment that interest rates would remain lower for longer saw the rand weaken to the upper end of the current range,” said TreasuryONE currency strategist Andre Cilliers.

At 5.50pm on Friday, the rand had weakened 0.74% to R14.8095/$, 0.63% to R17.4179/€ and 0.68% to R20.3703/£. The euro was flat at $1.1761.