Picture: JSE
Picture: JSE

THE JSE closed firmer on Monday as further stimulus talk from the European Central Bank (ECB) supported banking and financial shares, while gold and platinum stocks took a breather from their recent gains.

At 5pm the all share closed 2.60% higher at 49,852 points. The blue-chip top-40 index added 2.92%.

Banks rose 5.93% and financials gained 4.01%. Property rose 1.92%. Resources were up 2.84% and industrials ended the day 2.17% higher. The gold index dropped 4.34% and platinums shed 1.16%.

ECB president Mario Draghi said earlier on Monday the central bank was ready to ease policy in March if the financial market turmoil or the pass-through effect of low energy prices, reduced inflation expectations.

At the ECB’s last policy meeting, Mr Draghi raised the prospect of further policy easing in March as inflation expectations sank on tumbling energy prices, raising deflationary concerns.

Market sentiment was positive following a strong performance on Wall Street on Friday, and despite weak Chinese data released on Monday. Firmer global crude oil prices provided support for riskier asset trading.

The Brent crude price was 2.84% firmer at $33.69 a barrel in late afternoon trade.

The FTSE 100 was up 2.09% at the JSE’s close and the CAC 40 had gained 3.33%. The Dax had risen 2.8%. US markets were closed for a public holiday.

Most Asian equities strengthened on Monday, with the Japanese Nikkei 225 closing 7.16% higher. The weaker yen boosted shares of Japanese exporters, while a stronger currency last week had contributed to an 11% decline in Japanese stocks.

The Hong Kong Hang Seng closed 3.27% higher on Monday, while the Dow gained more than 2% on Friday.

China’s markets reopened on Monday after a week-long Lunar New Year holiday. However, the world’s second-largest economy’s January trade data were weaker than expected, with exports contracting 11.2% year on year from a consensus forecast of a decline of 1.8%, Barclays Research said.

The strong start for the week on the JSE means the all share is now edging closer to breakeven in 2016, with rand hedges the star performers. SABMiller rose 55% last year and is 1.16% higher so far this year, while the all share is 1.66% lower in 2016.

FNB Private Wealth CEO Eric Enslin said high returns from companies that had operations in SA only would be hard to come by in future. "But there might be opportunities in companies that have offshore operations."

The most basic way to get offshore exposure was to buy shares in companies whose profits were largely generated outside SA. Diversification across sectors to cushion against industry volatility was also an advantageous step, Mr Enslin said.

"Such shares tend to cost slightly higher than most but the performance of those companies is likely to be better than those limited to SA. Significantly, if the rand remains weak, returns in foreign currency will provide a boost," Mr Enslin said.

Among individual shares on the JSE, Anglo American surged 8.27% to R89.29, while Sasol gained 5.17% to R429.82.

AngloGold Ashanti fell 4.91% to R172 and Harmony shed 10.45% to R39.40.

Anglo American Platinum was down 6.14% at R295.73, while Lonmin bucked the trend, adding 2.90% to R19.16.

Among banks, Barclays Africa jumped 7.14% to R156.96, Nedbank rose 5.81% to R194.32 and FirstRand ended the day 5.79% up at R46.97.

Old Mutual gained 5.07% to R38.12.

Group Five soared 8.82% to R19.49 after reporting on Monday that fully diluted headline earnings per share (HEPS) for the six months to December 31 2015 rose 21% year on year, to 131c.

Among property stocks, Hyprop firmed 4.50% to R104.19.

KAP Industrial Holdings added 1.79% to R5.70. It reported on the day headline earnings per share from continuing operations for the six months to end-December 2015 were up 15% to 21.4c, compared with the year-earlier period.