MARKET WRAP: JSE in record territory again

MARKET WRAP: JSE in record territory again

2021-12-07 08:11:00 PM

MARKET WRAP: JSE in record territory again

Investor appetite returns as early indications point to Omicron variant being less less severe than initially feared

concerns about the Omicron variant of Covid-19 eased.The JSE all share gained more than 2% — the most since March — as early indications suggest that the latest strain of the virus isn’t as severe as initially feared. Initial data from SA continues to point to infections of Omicron leading to mild illness, and while cases have surged, patients are requiring less medical intervention. 

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While the president of  pharmaceutical and biotechnology company Moderna has warned of a “real risk” that existing Covid-19 vaccines will be less effective against Omicron, Anthony Fauci, the US’s medical adviser, said its severity may be limited.

On Tuesday, research from GlaxoSmithKline shows its antibody treatment is effective against the new strain. Some governments are, however, continuing to exercise caution, including the imposition of a vaccine mandate on workers in the private sector and tightening up on preventive measures.

“Following on from Monday’s indicative news from SA that the new Covid-19 variant could be milder than previous versions symptom-wise, much the same message was reinforced by Anthony Fauci. That was all markets needed to hear, really, and equity markets piled back in,” said Oanda senior market analyst Jeffrey Halley.

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The JSE all share closed 2.71% higher at 72,939.25 points — led by industrial metals (5.65%), resources (4%), and industrials (2.66%) — and the top 40 was up 2.96%.“The JSE ... is benefiting from risk-on sentiment as fears surrounding the potential of the Omicron variant’s disruption to a global economic recovery wane,” said IG senior market Shaun Murison. “Emerging markets ... have been underperforming developed markets for quite some time and are finding some impetus to exaggerate gains and outperform over the near term.” 

Murison noted that resources were a primary driver of the JSE on Tuesday. “A positive global economic recovery suggests increased appetite for these commodities,” he added.At 6.43pm, the Dow Jones industrial average was 1.55% firmer at 35,773.38 points. In Europe,

London’s FTSE 100 closed 1.49% higher, Germany’s DAX added 2.82% and France’s CAC 40 was up 2.91%.Earlier in Asia, Japan’s Nikkei ended the day 1.89% firmer, Hong Kong’s Hang Seng was 2.71% higher and the Shanghai Composite added 0.16%.  At 6.09pm, the rand had strengthened 0.16% to

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 R15.8619/$, 0.54% to R17.8206/€ and 0.42% to 20.9857/£.The euro was 0.43% at $1.1236.

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JSE faces mixed Asian markets as Omicron threat recedesNew variant is not putting too much pressure on hospitals, while investors are also eyeing monetary policy

JSE likely to push higher in line with global marketsAll share index could follow the lead of Wall Street and Asian bourses

JSE lifts as equity markets enjoy waning fears of OmicronEarly indications suggest that the effect of the variant is not as severe as initially feared

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