The Johannesburg Stock Exchange, in Sandton, Johannesburg. File picture: ROBERT TSHABALALA
The Johannesburg Stock Exchange, in Sandton, Johannesburg. File picture: ROBERT TSHABALALA

The JSE weakened on Wednesday, as risk-off sentiment from a number of global issues saw stocks in banks and retailers retreat.

Miners were weaker on a stronger rand, while the property index closed higher for a second consecutive day.

The Dow was 0.3% lower at the JSE’s close, following weaker Asian markets, while European markets were mixed. Asian markets fell despite the release of strong Chinese industrial growth data, of more than 7%, as exports surged in the first two months of the year.

Investors have focused on a range of political and trade uncertainties this week following a cabinet shake-up in Washington on Tuesday and ongoing discussions around US import tariffs, Dow Jones Newswires said.

Analysts said media reports suggesting potential tariffs aimed at China contributed to Wednesday's weak appetite for risk in Asia. In the long term, the question is whether recent moves should be considered a warning sign of a broader march toward protectionism, which tends to lead to less growth and more inflation, said Wouter Sturkenboom, a senior investment strategist at Russell Investments.

The cautious stance was further aggravated after European Central Bank (ECB) president Mario Draghi warned that the bank was not yet ready to end its extended bond-buying programme, pointing to new threats from US trade restrictions and a strengthening euro.

Local banking and retail shares have a large percentage of foreign shareholders, who usually sell off when risk-off sentiment dominates. Both sectors have rallied since last year, so a measure of profit-taking is not that unexpected, despite ongoing upbeat data reflecting confidence in these sectors.

A Mastercard study, released on Wednesday, indicated that South African consumer spending for January 2018 climbed an annual 3.8%, the same pace of growth the retail industry saw during the December peak season.

Including the effects of inflation, retail sales for January grew 7.3%. Inflation contributed just 3.5 percentage points to overall sales growth, the lowest levels seen since 2013, Mastercard said.

The all share closed 1.12% lower at 58,423.20 points and the top 40 lost 1.11%. General retailers relinquished 2.29%, food and drug retailers 2.28%, banks 1.77%, industrials 1.41% and financials 1.23%. The property index added 0.92%.

Sasol lost 2.42% to R402.01, while Brent crude was 1% lower at $64.18 a barrel.

Brait lost 4.16% to R39.20 after its UK New Look division announced the closure of 60 stores.

Standard Bank dropped 2.27% to R222.14 and Nedbank 3.92% to R294.

Old Mutual was 3.67% lower at R40.92 on the news that two US companies had lodged a claim against it in a New York court relating to US assets the company sold eight years ago.

Woolworths lost 3.19% to R60.75 and Massmart 3.79% to R165.

Resilient rocketed 5.94% to R67.25, Fortress B 8.88% to R15.69 and Nepi Rockcastle 7.13% to R134.99.

Naspers lost 1.2% to R3,538.

EOH plummeted 20.98% to R59.50 after the release earlier of a disappointing trading update. The company said it expected to report a decline of up to 30% in interim headline earnings per share (HEPS) for the six months to end-January.

MTN lost 2.33% to R127.45 and Vodacom 3.14% to R160.78.