Cape Town – The JSE managed to close higher on Friday, after trading up for most of the day in line with positive world markets.
The rand, however, fell sharply in response to dollar strength, slipping 1.33% to trade at R13.66 against the greenback at the close of the JSE.
Banks and retailers were notably under pressure, which was partly caused by a weaker rand, with Barclays Africa [JSE:BGA] down 4.13% to R144.59, Nedbank [JSE:NED] down 2.40% to R219.42, FirstRand [JSE:FSR] ending 2.15% lower at R53.19, and Capitec [JSE:CPI] down 0.97% to R921 a share.
The All Share index edged higher by 0.09%, while the blue-chip Top 40 index gained 0.15%, largely supported by dual listed shares benefitting from the weaker rand, led by Naspers [JSE:NPN] which climbed 1.29% to reach R3 301.12 per share.
As the local market awaits Finance Minister Malusi Gigaba's medium term budget policy statement next week, investors were generally cautious over the prospects of loose fiscal spending.
Gold prices eased to $1 280 per ounce, as global stock markets continued to push after reaching record highs on Wednesday, after a flurry of underwhelming earnings reports in the US. Demand for safe-haven assets, meanwhile, eased as equity markets soared.
US stocks traded higher on Friday, after the Republicans took a step toward achieving tax reform.
The Dow Jones industrial average rose 100 points on Thursday, reaching an intra-day record. UnitedHealth and Boeing both rose more than 1.3 percent. Shares of JPMorgan Chase, meanwhile, hit an all-time high after they also jumped by 1 percent.
The S&P 500 also notched an intraday all-time high, advancing 0.32 percent as financials led advancers.
US budget
In the US, the Senate approved a $4 trillion budget measure Thursday by a 51-49 vote. Passing a budget unlocks reconciliation, which enables the GOP to pass a tax bill with a simple 51-vote majority in the Senate.
Using the tool removes the need for winning Democratic support, which would likely sink a GOP tax measure.
Rising expectations of lower corporate taxes in the US have helped stocks rise to record highs recently, along with strong corporate earnings and solid economic data. The Dow, for example, first crossed above 23 000 earlier this week.
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