The JSE tracked firmer global markets on Thursday, closing at a fifth straight record high, while the rand hovered around the strongest levels last seen in February 2023.
The all share index surged to an intraday high of 87,802 points, before closing the session 1.59% firmer at 87,327 points.
The rand strengthened to an intraday best of R17.1277/$ as fresh US data added to the positive sentiment driven by interest rate cuts by the US Federal Reserve and the SA Reserve Bank.
Data from the US released earlier in the day pointed to sustained momentum in the country’s economy, easing concerns that the Fed had acted too slowly in easing monetary policy. The number of Americans filing for unemployment benefits for the first time, known as initial jobless claims, declined more than expected, signalling a steady labour market.
Another report showed US second-quarter GDP growth held steady at 3%, confirming a strong economic rebound.
“This decrease in initial jobless claims ... is seen as an early indicator of the US economic health,” said Wichard Cilliers, director and head of market risk at TreasuryONE.
“The latest data is being perceived as a positive sign, suggesting a robust labour market and a healthy US economy.”
Positive sentiment is also being driven by the recent announcement of a significant stimulus package by Chinese policymakers to help revitalise the world’s second-largest economy to growth levels last seen before the Covid-19 pandemic.
The measures, announced on Tuesday, are designed to address pressing issues, including weak credit demand by businesses and consumers, as well as unresolved problems after large devaluations in the country’s property sector.
“Traders continue to favour emerging markets and riskier segments of the market amid falling interest rates,” said Citadel Global director Bianca Botes. “Persistent optimism around the stimulus measures in China has also added to the upbeat sentiment.”
The top 40 added 1.71%, while the JSE’s other main indices were firmer — except for SA listed property and food producers.
At 7.05pm, the Dow Jones industrial average was 0.6% firmer at 42,165.75 points, while markets in Europe were also firmer.
Investors are now awaiting the latest reading of the US personal consumption expenditure (PCE) index — the Fed’s preferred measure of inflation, which will be published on Friday.
At 6.50pm, the rand had firmed 0.57% to R17.169/$ and 0.1% to R19.1788/€, though it was 0.12% weaker at R23.0263/£. The euro was 0.31% firmer at $1.1168.
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