JSE follows world markets lower

After a short spurt to the upside on Monday morning, the JSE headed lower by midday as it followed its international counterparts.

By noon, the JSE’s broader all-share index had pulled back 0,66%. Banks declined 2,09% and financials retreated 1,51%.
The platinum mining index decreased 1,16%, resources weakened 0,49% but the gold mining index gained 1,43%. Industrials were 0,53% lower.

The rand was bid at 8,10 to the US dollar while gold was quoted at $937,35 a troy ounce from $933,92/oz at the JSE’s last close.

“The JSE had a brief spell in positive territory, but that was really as it opened and now it is taking the lead from world markets,” said an equities trader.

The UK’s FTSE 100 shed 0,73%, while Asia’s Hang Seng fell 1,88% and the Nikkei dropped 2,3%. On Friday, Wall Street’s DJIA ended 0,70% in the red, the Nasdaq lost 0,86% and the S&P500 dipped 0,80%.

“I think the market will be under pressure this week, it is going to be a huge week in terms of data. We have local trade data today, and another big number we will be watching is the non-farm payrolls out of the [United] States on Friday,” the trader said.

An I-Net Bridge survey has found that South Africa’s foreign trade balance with its non-Southern African Customs Union (SACU) trading partners is expected to have contracted to a four billion rand deficit in February from the R10,2-billion deficit in January.

Local money supply and PSCE data will also be released later this week.

“The only surprising pocket of strength on the JSE today is the gold index. The gold price is marginally higher, and gold counters are against the trend largely thanks to AngloGold. It is quite surprising that they are firm,” said the trader.

He added that the rand remained weak, but off its worst levels for the day. “If the rand weakens further, it could underpin gains in this market, but if it strengthens, it could put pressure on rand-hedged stocks,” he said.

He added that financial counters were all weaker. “Last week they decoupled from global markets, but now they are all falling back in line with the Asian and European markets, where most of the financials have been under pressure,” he said.

“It has been a very iffy start to the day. It is now a waiting game for the data, and the market is in a holding phase. So far, it has been quite a boring day on the JSE,” he said.

Resource heavyweight Anglo American was down R2 to R483, while BHP Billiton eased 11 cents to R237,90 and Sasol fell R8,49, or 2,14%, to R388,01.

AngloGold Ashanti picked up R7,42, or 2,75%, to R277,62 and Gold Fields was R1,12 better, at R119,52.

Anglo Platinum was off R5 to R1 195, Impala Platinum dropped R5,50, or 1,72%, to R314 and Lonmin pulled back R11, or 2,2%, to R489.

In the building and construction sector, PPC lifted R1,30, or 3,16%, to R42,50 and Murray & Roberts improved R3, or 3,19%, to R97.

Brewer SABMiller gave up R3,88, or 2,16%, to R176,13 and luxury goods group Richemont added 64 cents, or 1,44%, to R44,95.

Mobile operator MTN Group dipped R2,23, or 1,73%, to R126,67 and fixed-line operator Telkom slumped R9,53, or 6,53%, to R136,47 on news that it had rejected a bid by Oger. It earlier reported that the “previously announced expression of interest by Oger Telecoms was evaluated by the board and has been declined, as it is not in the interests of Telkom shareholders”.

Absa decreased R2,49, or 2,41%, to R100,65 and FirstRand was down 36 cents, or 2,19%, to R16,11. - I-Net Bridge

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