Better than expected employment data out of the US on Friday propelled global markets higher, with the JSE resuming its recent rally. The All Share Index jumped 2.9%, taking gains for the week to 8.4%. The market is now at its highest since late February and has recovered losses incurred in March as the Covid-19 pandemic escalated.

The US unemployment rate declined to 13.3% in May from 14.7% in April as employers added 2.5 million jobs after big losses the previous two months.

At home, Metair's shares rose after it announced contracts to supply parts for new Ford vehicles, which will result in investment in new facilities and create thousands of jobs. MultiChoice also closed higher after the pay-TV group said results out this week would show improved profitability. Meanwhile, NEPI Rockcastle says customers are returning to its shopping centres across Central and Eastern Europe as lockdown restrictions are relaxed in the region, sending its shares higher.

In The Week Ahead, Chris Gilmour looks back at some of the news that guided markets last week, including the May employment numbers out of the US. This week, results from Adcorp will show a sharp slide in profitability due to pressure on the jobs market here and in Australia.

I hope you have a good week.

Stephen Gunnion

Managing Editor, InceConnect

Here's the latest from Ingham Analytics.

Energy (Oil & Gas) - Sasol: "Henry sends a message"

Sasol has climbed from a low of R20 in March and we pose the question in "Henry sends a message": is this the beginning of a major recovery? Whilst lower for longer on the price of natural gas is good for the Lake Charles Chemicals Project, we point out that it is but not good enough to offset other pressing challenges. We're also expecting a thumping fall in EPS for the year to June and it may even be worse because of several variables. This is a good example of share price action driven by sentiment rather than fundamentals. We've also given you our latest call on the investment merits and a trading tactic for the day traders to take advantage of volatility.

Banking sector: "South African banks' balance sheets surge"

Our take on the banking sector of the JSE over many months has saved us a lot of money and hopefully you too. FirstRand last Wednesday warned of higher impairments and future credit losses and the problem of the negative endowment effect of interest rate cuts and margin pressure - factors we've assessed in earlier notes. "South African banks' balance sheets surge" shows just how the collective balance sheet changed in only one month and why.

Prosus/Naspers/Tencent: "Illusory value"

"Illusory value" has been a very popular download and as these stocks are core in our coverage universe, we'll be keeping readers regularly apprised of our view and trading suggestions.