THE JSE closed higher on Wednesday owing to broad-based gains, as risk sentiment towards emerging markets improved on the day.
Resources led the gainers, with both Anglo American and Glencore lifting after announcing respective restructuring exercises.
At 5pm, the all share closed 1.32% up at 50,039.30 points, the first close above 50,000 this year. The blue-chip top 40 rose 1.46%.
Resources were up 3.28% and financials gained 1.22%. Platinum rose 1.16% and industrials ended the day 0.93% higher. The gold index was 2.71% lower.
Barclays Research analysts said European equities rallied further on Wednesday, as global risk appetite continued to stabilise. Asian equities were mixed, however, failing to materially extend the global rally.
At the JSE’s close the FTSE 100 was up 2.17% and the CAC 40 had gained 2.39%. The Dax had added 2.12%. The Dow Jones industrial average had risen 0.81%.
Oil prices rose in volatile trade after Russia, Saudi Arabia, Qatar and Venezuela agreed to a potential freeze of oil production at January’s levels. The Brent crude price was 2.75% higher at $33.21 a barrel in the late afternoon.
Local data on the day showed that the prices consumers paid, as reflected by the consumer price index, rose 6.2% in January from 5.2% in December.
Retail shares reacted positively to retail trade sales data, indicating annual growth in the sector of 4.1% in December from 3.8% in November.
The retail sales figures for December, which showed another surprisingly strong year-on-year rise in purchases, suggested that the economy narrowly avoided a fall in gross domestic product (GDP) at the end of last year, Capital Economics analysts said.
Nonetheless, Capital Economics said the growth outlook for this year remained pretty grim. "We expect GDP to grow by a below-consensus 0.5%."
The US Federal Reserve’s January Federal open market committee (FOMC) minutes release was likely to be the key focus for US markets on Wednesday, though Barclays did not expect substantive new information from the release.
TreasuryOne’s head of dealing, Wichard Cilliers, said the minutes had the potential to create additional market volatility leading up to the event at 9pm, well after the JSE closed at 5pm.
Volatility as a result of the minutes, however, were expected to be limited given the events that unfolded in the last few weeks since the start of the year, and at the last FOMC meeting.
Chairwoman Janet Yellen’s testimony last week firmly indicated that the Fed regarded further rate increases as still very dependent on market movements, so that mostly dovish comments were expected, Mr Cilliers said.
Among individual shares on the JSE, Anglo American closed 9.44% higher at R97.36.
Glencore rose 11.73% to R26.19 after the company announced on Wednesday that it would refinance its loan facility in response to falling commodity prices, Dow Jones Newswires reported.
Glencore was replacing its existing $8.45bn revolving credit facility with a smaller $7.7bn unsecured facility that had no financial covenants and expired in May 2018, the newswires said.
After climbing 12% in intraday trade, Kumba Iron Ore ended the day 6.9% up at R62.
Sasol rose 1.98% to R437 on the firmer oil price.
On the local gold board, AngloGold Ashanti fell 3.63% to R167.70 and Harmony was down 4.43% to R38.66.
Financial services group Discovery lost 5.21% to R115.45 after the company said on Wednesday it expected headline earnings per share to fall between 45% and 55% to between 322.6c and 264c in the six months to December 31 2015. Discovery’s results were due for release on February 25.
Among retailers, Mr Price climbed 2.81% to R164.25 and Shoprite ended the day 3.51% up at R151.40.