Business

JSE hits record high as metal prices surge and the rand strengthens

Published

4 hours ago

January 26, 2026

Chiraag

South Africa JSE record high, FTSE JSE All Share Index, Johannesburg Stock Exchange trading floor, mining stocks rally, rand exchange rate strength, Joburg ETC

A rare moment of confidence on the JSE

For a market that has weathered years of power cuts, political uncertainty, and sluggish growth, this week delivered a moment South African investors do not get often enough. The Johannesburg Stock Exchange climbed to a new all-time high on Monday, lifted by a powerful mix of surging metal prices and a rand that finally caught a second wind.

The FTSE JSE Africa All Share Index jumped by more than one percent on the day, pushing its year-to-date gains to about 6.8 percent. For many local investors, it felt like a reminder of just how quickly sentiment can turn when global and domestic forces briefly line up.

Why mining stocks are back in the spotlight

The biggest driver behind the rally was the resources sector, a familiar hero in South Africa’s market history. Precious metals and mining shares led the charge after gold surged past five thousand dollars an ounce for the first time. Platinum and silver also touched record levels, reigniting interest in companies long seen as cyclical and volatile.

On social media, local finance commentators were quick to point out the symbolism. Mining, often criticised for being too dominant in the economy, once again proved to be the backbone of the JSE when global demand spikes. For everyday South Africans with retirement funds tied to the market, the gains were a welcome sight after years of uneven performance.

A stronger rand changes the mood

Adding to the optimism was the rand’s unexpected strength. The currency firmed below sixteen to the dollar for the first time since 2022, easing fears around imported inflation. A stronger rand improves the outlook for lower inflation and eventually lower interest rates, something households and businesses alike have been desperate for.

This shift has not gone unnoticed by investors. Lower inflation and borrowing costs tend to support company earnings, particularly in consumer-facing sectors that have struggled under high interest rates.

Fund managers remain bullish but cautious

Even after a powerful run that saw South African equities gain more than fifty percent in dollar terms last year, fund managers are not rushing for the exits. A recent Bank of America survey shows growing confidence in local equities, helped by the fact that the market still looks relatively cheap. The JSE trades on an estimated forward price earnings ratio of about 15.6, compared with nearly 17 for broader emerging markets.

Rehana Khan, co-head of South African equity and multi-asset at Ninety One, says expectations need to be managed after such a strong rally. Still, she believes local equities can deliver inflation-beating returns through 2026, supported by easing inflation, lower interest rates, and a modest economic recovery. Ninety One expects double-digit earnings growth in parts of the market as these conditions begin to filter through.

What could derail the rally

The outlook is not without risk. A resurgence in global inflation could delay or reverse interest rate cuts, while a stronger US dollar would put pressure on emerging markets like South Africa. Ongoing geopolitical tensions and rapid disruption from artificial intelligence add further layers of uncertainty.

Yet the broader message from market professionals is one of discipline rather than panic. Periods of volatility, Khan notes, often create opportunities for investors who stay focused on fundamentals.

For now, the JSE’s record high feels less like a fluke and more like a reflection of improving conditions. Whether the rally has staying power will depend on how long the metals boom lasts and whether the rand can hold its ground. Either way, it is a reminder that South Africa’s market still knows how to surprise.