MARKET WRAP: JSE closes lower despite upbeat global trade
The all share falls as World Bank cuts growth prospects, with a hawkish stance from the Reserve Bank becoming more likely
The JSE ended Wednesday lower as investors digested the increased likelihood that the Reserve Bank will eventually have to hike interest rates. Reserve Bank deputy governor Daniel Mminele warned on Tuesday that consumer inflation could overshoot the 6% upper limit of its target band. “Given the volatile environment, the risk of an overshoot of the target, given the balance of risks, should not be under-estimated,” he said in New York on Tuesday, in a speech posted on the Bank’s website. This will affect local economic growth negatively with the World Bank downgrading growth for 2018 to 1% from 1.4% on Wednesday. Losses on the JSE on Wednesday were fairly broad-based, with banks faring worst on a weaker rand. Resources showed some resilience but faltered towards the close despite Brent crude jumping above $85 a barrel again. Naspers lost 1% to R2,970, its first close below R3,000 since April 26. SA is undergoing a very slow and volatile recovery to low potential growth of about 2% ag...
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