MARKET WRAP: JSE closes flat as rand gains boost banks
The JSE closed flat on Thursday as gains by banking and financial shares were offset by losses among miners and rand hedges, with the rand managing only marginal gains on the day.
The euro was firmer against the dollar as investors awaited the latest developments in the US-China trade dispute, while efforts to rewrite the North American Free Trade Agreement (Nafta) continued.
US President Donald Trump is widely expected to announce the imposition of 25% tariffs on $200bn worth of Chinese imports later on Thursday.
In US domestic politics, Trump faced renewed controversies, coming in the wake of a book by Bob Woodward describing chaotic policy-making conditions in the White House. Trump tweeted the single word "TREASON" in obvious reference to the release of an anonymous article in the New York Times in which a Trump senior aide describes him as "a president that continued to act in a manner that was detrimental to the health of our republic".
Later, Trump demanded that the New York Times hand over the person to the government "for national security reasons".
The all share closed 0.05% higher at 57,130.50 points and the top 40 gained 0.12%. Banks rose 2.68%, financials 1.28%, food and drug retailers 0.48% and property 0.32%. Resources shed 1.05%.
Anglo American lost 1.38% to R302.
FirstRand gained 3.9% to R67.35. It said earlier headline earnings per share (HEPS) for the year to end-June rose 12%.
Capitec softened 0.56% to R980.70 after informing the market half-year HEPS are expected to increase between 18% and 21%.
Sanlam rose 0.17% to R76.75. It earlier reported normalised headline earnings were up 10% for the interim period to end-June.
The rand was at R15.3652 to the dollar at the JSE’s close from R15.4235.
The rand has been under pressure along with other emerging markets this week, with added pressure from news that SA entered a technical recession in the second quarter. Local focus has now turned to how the government will rein in its budget deficit, with the weaker rand reflecting investor concern that ratings agency Moody’s is now more likely to downgrade SA’s debt to junk status.
Local bonds were a little firmer with the benchmark R186 last bid at 9.195% from 9.22%. The US 10-year treasury was last seen at 2.8762% after touching 2.9022% earlier.
The top 40 Alsi futures index dropped 0.09% to 50,697 points. The number of contracts traded was 23,285 from Wednesday’s 26,182.