MARKET WRAP: JSE flat after Tito Mboweni appointment, while rand jumps 30c
The local bourse pares losses to close flat after the news, with Naspers offsetting broad-based gains
The JSE was little changed on Tuesday, with a poor performance from Naspers weighing on the bourse, despite a strong showing by banks and miners.
Local market focus was squarely on the future of former finance minister Nhlanhla Nene, as rumours did the rounds as to his possible replacement after it emerged he lied about previous meetings with the controversial Gupta family.
The rand weakened past R15 to the dollar for the first time in three weeks, putting pressure on interest rate-sensitive shares, although miners fared well. The rand, however, jumped in the afternoon as speculation mounted that former Reserve Bank governor Tito Mboweni would replace Nene.
Following the news, banks and retailers reversed earlier losses to close higher, as the rand firmed bout 30c to the dollar.
The all share fell 0.06% to 54,187.8 points, while the top 40 lost 0.15%. Gold miners gained 3.22% and banks 1.19%. Industrials fell 0.71%.
Naspers fell 1.53% to R2,840.77, tracking losses in Hong Kong-listed associate Tencent.
Global market focus was on events in Pakistan, where a request for an International Monetary Fund (IMF) bailout has sparked concern of emerging-market contagion, said FXTM global head of currency Jameel Ahmad.
Local focus for the week is now expected to shift to an expected announcement by Moody’s on SA’s sovereign credit rating on Friday. Intense focus is also expected to fall on the medium-term budget policy statement later in October, which will now be delivered by Mboweni.
Earlier, SA’s scheduled government bond auction saw R2.4bn in paper sold, with the auction almost three times over-subscribed.
Diversified miner Anglo American firmed 1.84% to R326.19.
FirstRand gained 1.95% to R62.09.
AfroCentric gave up 0.91% to R5.45, after it announced earlier that it was exercising a call option to turn its 26%-owned pharmaceutical distribution company, Activo, into a wholly owned subsidiary in a deal valued at R588m.
Invicta Holdings slumped 8.57% to R32, after it warned shareholders earlier that the JSE had re-opened an investigation into the sale of shares to Invicta’s subsidiary, Humulani Marketing, which occurred without the required shareholder approval.
MTN rose 0.74% to R86.64, amid reports that the company and four banks where meeting with the Nigerian central bank on Tuesday, in an ongoing a dispute over $8.1bn that Nigerian authorities said was transferred illegally out of the country.
Shortly after the JSE closed, the Dow was off 0.21% to 26,425.13 points, while in Europe, the FTSE 100 was flat, the CAC 40 was up 0.34% and the DAX 30 0.28%.
At the same time, platinum was up 0.42% to $823.63 an ounce while gold was flat at $1,188.20. Brent crude was 1.23% higher at $84.84.