JSE down, banks dip on CPI data
The JSE remained in negative territory at midday on Wednesday, as banks took a dip on the release of discouraging CPI data and resources were lower on a firmer rand.
At 11.59am, the all-share index was 0,25% lower, as resources dipped 0,35%.
However, the gold and platinum mining indices advanced 0,28% and 0,35% respectively. Banks pulled back 0,29%, but financials were barely changed, up
0,07%. Industrials gave up 0,15%.
Shortly before midday, local consumer inflation data was released which was quite disappointing for the market. CPI in September went up 7,2% y/y, with the market expecting a 6,9% rise, while CPIX grew 6,7% y/y. Market players were only expecting 6,4% for CPIX.
The rand was trading at 16-month best levels against the dollar on Wednesday morning receiving a further boost from the weaker than expected inflation data which has raised the spectre of another interest rate hike in December. The rand was bid at 6,65 to the US dollar from 6,71 when the JSE closed on Tuesday, while gold was quoted at $756,95 a troy ounce from $757,70/oz at the JSE’s last close.
One trader said that even with the CPI data, the market still seemed quite resilient, but banks started taking a smack on the release of the data.
“The market is nervous, and the Dow is at a critical point. The rand has also technically broken [levels], and the new consensus is now at the 6,20 to 6,30 level, which could put pressure on gold and resources. Gold shares could come off a bit,” he said.
Among gold counters on the JSE, AngloGold Ashanti edged up R2,47 to R298,72 and Gold Fields shed ten cents to R119,70.
On the resource index, Anglo-American fell R3,25 to R427,25 and BHP Billiton slipped R1,69 to R246,81.
Petrochemicals giant Sasol inched up 20 cents to R328.
Platinum miner Anglo Platinum climbed R11,49, or 1,1%, to R1 060 and Impala Platinum added 15 cents to R233,15, but Lonmin pulled back R6,92, or 1,47%, to R463,59.
Brand management group Barloworld retreated 74 cents to R125,85, and brewer SABMiller gave up R1,50 to R194,50.
In the banking sector, Absa was 79 cents lower, at R124,95, and Standard Bank lost R1,55, or 1,42%, to R107,90. Earlier, ETM analysts said in their morning report that the big news yesterday was a cautionary note issued by Standard Bank, which said that the bank was in talks that could affect its share price. This created speculation that the bank was either the target of a foreign investor, or that Standard itself was trying to buy a stake in another bank. On Tuesday, in reaction, shares in Standard Bank rose more than 5% but gave up some of the gains to close up 3,75%.
Nedbank advanced R1,10 to R140,50 and FirstRand was 11 cents better, at R24,10. - I-Net Bridge