/ 6 December 2013

JSE shuts down for five minutes in honour of Mandela

A file photograph of former president Nelson Mandela in 2006.
A file photograph of former president Nelson Mandela in 2006.

Tributes from the corporate world and business leaders have begun streaming in for former president Nelson Mandela, who died on Thursday. The JSE halted trade for five minutes at 11am on Friday to mark the passing of the great statesman and the Banking Association of South Africa (Basa) announced that the country's banks, from head office to branches, will be closed on the day of Madiba's funeral.

"Nelson Mandela was a courageous and visionary leader who enabled his country to confront its past and inspired its people to address an extraordinary set of challenges," director of the International Monetary Fund, Christine Lagarde, said.

"He was a man who brought deep principles, skillful diplomacy and quiet dignity to the task of national reconciliation and nation building," she said.

Basa managing director Cas Coovadia said: "South Africa has lost a father and the rest of the world has lost an icon who worked tirelessly to make this a better world."

Banks communicated with their respective customers on the closures and provided the necessary support to ensure the public had access to basic services.

"Banks will follow their own processes and procedures to support staff who may want to attend memorials and be absent from work during the dedicated days of mourning," Coovadia said. "It will be at the banks' discretion to remain open on the official days of mourning and state memorial; however, they will continue to provide the necessary support at customer interface levels."

 The JSE's head of investor relations, Michelle Joubert, confirmed that the Johannesburg exchange would halt trade for five minutes on Friday. The JSE would be guided by government as to any future public holidays or days of mourning, to mark Madiba's passing.

Anglo American chief executive Mark Cutifani expressed condolences to Madiba's family as well as to the people of South Africa. 

"He was integral to the ushering of democracy in South Africa, and led the country with distinction, stature and humility during his presidency," he said. The mining major would "continue to do its utmost to shadow Madiba's legacy".

Analysts dismiss the doomsayers
Financial anaylsts have already dismissed fears that South Africa's markets would slide into a tailspin on the Madiba's passing. 

"He was an amazing icon who was both an inspiration yet truly human as well which is why so many people felt such a connection to him," said Nomura's Peter Attard Montalto.

Madiba had left a "strong enough country with solid foundations", he said, and "we should dismiss the inevitable doomsayers and expect little market reaction".

Indeed although the rand dropped to R10.53 to the dollar just after 7am on Friday morning, by 10am it recovered to R10.43.

The drop was arguably more off the back of a slew of economic data this week, including a trade deficit widening to 6.8% of gross domestic product, which saw the rand already drop to its lowest level since the height of the recession five years ago. In addition, on Wednesday the automatic data processing employment report for November showed job creation rising in the United States, resurrecting fears that the US Federal Reserve would soon begin tapering off it $85-billion a month asset purchasing programme. – Additional reporting by Lisa Steyn