South African Stocks Rally in Longest Winning Streak in 6 Weeks

South African stocks jumped in the longest stretch of gains since Feb. 24 as investors sought returns in emerging markets on the likelihood that interest rates in the U.S. will remain low for longer.

The FTSE/JSE Africa All Share Index climbed a third day, joining a rally in developing nations from Saudi Arabia to Vietnam. The MSCI Emerging Markets Index advanced to the highest since Sept. 25 after minutes from the Federal Reserve meeting last month showed policy makers were split over whether they would raise rates in June.

“Whilst the interest rate remains low, and while you’re seeing stimulus measures happening in the likes of Europe and places like China, you’ll continue to see an underlying demand for equity risk until such a time that we start to see interest rates change,” Ferdi Heyneke, a Johannesburg-based money manager at Afrifocus Securities, said by phone.

The debate in March over when to raise U.S. borrowing costs from near zero came before disappointing payrolls data on April 3 and as central banks in Europe and Asia step up economic-stimulus programs. Cheaper money and low rates bolstered assets in developing countries such as South Africa, as investors seek higher returns in places seen as risky.

The Johannesburg all-share measure rose 0.3 percent to 52,984.55 by the close in the city, the highest since March 6, as 95 stocks gained, 63 fell and 13 were unchanged. The rand weakened 0.8 percent to 11.9125 per dollar after data showed jobless claims in the U.S. over the past four weeks were the lowest in 15 years, signaling underlying strength in the labor market.

‘Even Better’

Consolidated Infrastructure Ltd. led gainers, rallying 10 percent to 27.07 rand on trading volumes 8.9 times the three-month daily average. Naspers Ltd., the media company based in Cape Town, rose to a record high, advancing 2.1 percent to 1,919.57 rand as its Chinese unit, Tencent Holdings Ltd., jumped in Hong Kong.

The South African index, which is about 400 points below a record high reached in February, was constrained by slumping miners, according to Heyneke. Harmony Gold Mining Co. fell 5.8 percent to 21.20 rand, while African Rainbow Minerals Ltd. decreased 3.3 percent to 96.20 rand.

“The all-share index would be even better if these mining shares can get going as well,” he said. “They form quite a large percentage of that index.”

(An earlier version of this story corrected the date of payrolls data in fourth paragraph.)

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