South African equities jumped, led by precious-metals producers, with the
FTSE/JSE All Share rising as much as 5.2%—its largest intraday gain since April
8. The Johannesburg Stock Exchange was closed Wednesday for a local holiday. The
move followed a decisive Democratic midterm victory that markets expect will
curb President Trump’s tax and spending plans, sending the dollar and U.S.
Treasury yields lower and boosting gold; lower yields and a softer dollar
typically support non-yielding bullion. Rowan Williams, CIO at Johannesburg
Nitrogen Fund Management, said precious metals’ recent correlation with U.S.
rates and the dollar has exceeded their link to geopolitical risk, and with
Democrats now controlling both chambers he sees geopolitical risk as reduced.
