File Image: IOL
JOHANNESBURG - The JSE closed yesterday’s session higher, while the rand continued its losses as the US-China trade tensions soured investor sentiment.

The broader all share index strengthened 0.38percent to 56092 points, while the blue chip Top40 index inched up 0.51percent at 49391 points.

The industrial index closed the session up 0.67percent, while the financials index added 0.25percent.

However, gold mining stocks closed the session on the back foot, losing 0.63percent, while the resources stocks lost 0.04percent.

Dave Mohr, the chief investment strategist at Old Mutual Multi-Managers, said with each successive tariff announcement, the surprise factor would be less and market response should be milder.

“Markets tend to sell first and ask questions later, but it really does appear too soon to argue that a full-on trade war is looming. There is still plenty of time for the two sides to iron out an agreement,” Mohr said.

President Donald Trump last Thursday directed US trade officials to identify tariffs on $100billion (about R1.2trillion) more Chinese imports, upping the ante in an already high-stakes trade confrontation between the world’s two largest economies.

At 5pm yesterday, the local currency bid at R12.09 against the greenback, against R12.05 at the same time on Friday. The rand also backtracked against the pound and was at R17.09 against R16.98 on Friday, while it weakened from R14.78 to R14.89 against the euro.

Analysts from Merchant West said in a note that the escalating tensions between the two largest economies have hit investor demand for emerging market currencies.

“The rand was also undermined by concerns that momentum in the economy has slowed since a sharp rebound in the wake of Cyril Ramaphosa’s election as leader of the ruling African National Congress in late December,” Merchant West said.

Meanwhile, Reuters reports that the Dow Jones industrial average and the S&P were up more than 1percent, while the Nasdaq added 2percent yesterday afternoon as strength in technology shares and a softer stance by US policymakers on China trade tariffs powered a rebound from last week’s sell-off.

Ten of the 11 major S&P sectors were higher and 27 of the 30 Dow components were in the positive territory. Goldman Sachs was the biggest boost to the Dow.