JSE holds steady ahead of long weekend

Cape Town - The JSE closed firmer on Friday, with thin volumes traded ahead of the long weekend.

The rand held steady for most of the day, strengthening to R13.24/$ before losing ground to the dollar in late trade and by 17:30 weakened to R13.35/$. The local currency benefited from pedestrian US GDP data which softened the greenback. 

The S&P500 was trading 0.15% lower at the close of the JSE after poor GDP data was released. The US economy grew at its weakest pace in three years, as consumer spending slowed and businesses held back on inventory spending – limiting annual growth to 0.7% for the first quarter of 2017, down from 2.1% previously. The disappointing numbers are expected to be temporary, with the US labour market nearing full employment and consumer confidence near multi-year highs. 

Friday’s market winner went to Mediclinic International [JSE:MEI], vaulting +13.30%.  The rally came after the announcement that the Abu Dhabi government cancelled a requirement for citizens to make a 20% co-payment for treatment at private medical facilities.  The changes should boost volumes through Mediclinic owned operations in the United Arab Emirates. 

The blue-chip Top 40 Index closed 0.19% higher and the broader All-Share gained 0.25%.  Industrial shares were the big winners, with the index climbing 0.47%, followed by the Financial index 0.34% up.  The gold miners shed 0.86% whilst the Resources Index was down 0.45%. 

South African money supply and credit growth data released on Friday indicates that growth in private sector credit extension decelerated to 5% year on year in March, from 5.3% in February.  The depressed numbers are attributed to low consumer confidence and political instability. 

At the close of the local market, crude oil prices had edged higher by 0.08% amid hopes that major oil producers will extend production cuts to stabilise the market. Gains have remained limited as the global oil supply glut remains a concern. Opec, as well as Russia, originally pledged to cut output by almost 1.8 million barrels per day during the first half of the year.

The European Central Bank held its benchmark interest rate at zero, as Mario Draghi suggested downside risks to the Euro bloc’s economy had diminished and its economic recovery picked up pace. The ECB also stuck with its rate of asset purchases until the next meeting, proceeding with pace of quantitative easing bond purchases of €60bn per month. 

US President Donald Trump is expected to sign off an executive order, known as the America First Offshore Energy Strategy, on Friday. The deal is set to expand offshore oil and gas drilling in the Artic and Atlantic oceans.  Former president Barack Obama withdrew these areas from development in late December, barring energy exploration in marine sanctuaries and a string of canyons.

*This report is from the Trading Desk at EasyEquities, Fin24's latest content partner on equities and market moves.