JSE weakens, led by property, and local environment remains gloomy
Global markets are buoyant on trade talk optimism, while a ratings downgrade of Hyprop weighs on the JSE’s property index
The JSE was weaker on Wednesday morning, failing to track positive global markets, which were benefiting from US-China trade war developments.
Most Asian markets were at least 1% higher on Wednesday morning, but local factors, including load-shedding, continued to negatively affect domestic sentiment.
At 10am the all share was down 0.25% to 53,824.2 points and the top 40 down 0.28%. Property lost 1.9% and industrials 0.57%.
Hyprop Investments slumped 5.63% to R83.40. Earlier, it said Moody's had lowered its investment grade to junk status, citing debt-funded acquisitions in Eastern Europe that had increased its debt-to-asset ratio to 41% as of June 2018.
US President Donald Trump has indicated that a March 1 deadline for a trade deal with China is not set in stone. Trump said on Tuesday that if Chinese negotiators made sufficient concessions this week, new tariffs may not be implemented even if a new deal is not reached.
US markets closed higher on Tuesday, also bolstered by news that legislators reached a tentative funding agreement to avoid a second partial government shutdown. Trump has received only part of his requested funding for a border wall, however.
Locally, SA’s largest labour federation, Cosatu, has embarked on a one-day national strike. Load-shedding will continue on Wednesday.
Focus on Wednesday is on domestic retail sales data for December, due at 1pm. US inflation data at 3.30pm could also give the market some direction.
Rand hedge AB InBev was up 1.28% to R1,056.25 and Richemont 1.59% to R96.49.
Pan African Resources was up 3.72% to R1.95, having reported earlier that headline earning per share (HEPS) was expected to rise as much as 109% in the six months to end-December, mostly due to a depreciating rand. In rand terms, HEPS were expected to rise by between 8% and 18% compared with the same period in 2017.
Naspers had lost 1.29% to R3,025.31.
Curro gained 4.03% to R25.80, having said earlier that HEPS for the year to end-December had risen 23% to 60.1c, versus the comparative period.
Gold was flat at $1,311.75/oz, while platinum had fallen 0.24% to $789.09.
Brent crude was 0.53% higher at $62.90 a barrel.