Picture: JSE
Picture: JSE

A surprise contraction in Chinese exports in December weighed on global equity markets on Monday morning, with the JSE reacting to the news with broad-based losses.

Chinese exports slumped 4.4% in December, well below market expectations of 3% growth, with Asian markets posting sharp losses and oil slipping below $60/$ for the first time in five days.

At 9.50am Naspers had slumped 3.41% to R2,883, tracking a similar loss in its Hong Kong listed associate Tencent.

The all share fell 1.06% to 53,085.1 points and the top 40 was down 1.35%. Industrials lost 1.49%, banks 1.03% and financials 0.82%.

Brent crude was 1.34% lower at $59.78 a barrel.

Platinum was down 0.86% at $803.27/oz while gold firmed 0.42% to $1,292.62/oz.

Local market focus this week will be on the Reserve Bank interest rate decision on Thursday, although no change to the repo rate is expected.

Brexit is also on the agenda, with a crucial vote expected to take place on Tuesday in the UK parliament. UK Prime Minister Theresa May has battled to secure sufficient support for her draft Brexit deal.

Local politics is also expected to rise in importance as the May elections loom. At the weekend, the ANC released its election manifesto, which once again raised questions about the nationalisation of the Reserve Bank. The ANC is also looking to try to compel financial institutions to invest in projects deemed to have socioeconomic benefits.

“The concern is not that the party seeks to do more for the poor and rectify injustices of the past, but rather in how they choose to do so,” said Mercato Financial Services  analyst Nico du Plessis.

“The ideology currently being followed is one that favours larger government and more intervention at a time when the ANC’s cadre deployment has shown itself to be grossly unmeritocratic and has resulted in mass maladministration at an institutional and parastatal level,” said du Plessis.

Sasol fell 1.56% to R441.

Rand hedge British American Tobacco gained 1.36% to R453.84.

Vodacom gave up 1.56% to R130.19,  MTN 1.16% to R85.49 and Telkom 1.01% to R69.26.

gernetzkyk@businesslive.co.za