MARKET WRAP: JSE edges lower ahead of the budget speech

The JSE edged lower on Tuesday, as caution prevailed ahead of Wednesday’s budget policy statement.

Details on the future of, and funding for, SA’s embattled state-owned enterprises (SOEs) is expected from finance minister Tito Mboweni, as SA struggles to hold on to its last remaining investment-grade sovereign rating — from agency Moody’s Investors Service.

The all share fell 0.12% to 55,194.6 points and the top 40 0.13%. Platinums rose 2.6%, gold miners 1.82% and the property index 0.29%. Banks lost 1.44%, financials 0.87% and industrials 0.27%.

International focus is on US-China trade talks, which resume in Washington on Thursday. Analysts said this was supporting global risk sentiment, following reports of progress during last week’s meetings, in Beijing.

Investors digested a series of earnings reports on Tuesday, which will continue on Wednesday, with the release of Glencore’s results, while Anglo American is set to follow on Thursday. Some support also came from rising commodity prices, with palladium pushing to a record high. 

Anglo American Platinum gained 5% to R735. Sibanye-Stillwater gained 4.29% to R15.80.

Diversified miner BHP added 0.8% to R329.90. The JSE heavyweight reported that interim headline earnings per share (HEPS) to end-December more than doubled to 81.9 US cents from the previous matching period.

Kumba Iron Ore lost 2.64% to R376.30. It earlier reported a slight decrease in revenue for the year to end-December. Its dividend was slightly lower as well, at R30.21 per share, from R30.97 previously.

AngloGold Ashanti added 1% to R198.78, having earlier reported that HEPS jumped to $0.53 in the six months to end-December, from $0.06 in the prior comparative period.

Comair slipped 0.17% to R5.74, after earlier reporting HEPS for the six months to end-December declined 38% to 27.2c compared to same period in 2017.  The British Airways franchisee surged 21.98% on Friday, when it announced it had reached a settlement with SAA over its long-running battle over the state-owned airline’s anti-competitive behaviour.

EOH slumped 16.37% to R14.61, after earlier issuing a cautionary announcement to investors when trading in its shares while it looks into its past dealings with the state. The stock is currently at an eight-year low, coming under pressure recently following a report by TechCentral that Microsoft’s decision to cut ties with the company was linked to a tip-off about an allegedly dubious contract with SA’s defence department.

At the JSE’s close, gold had gained 0.66% to $1,334.84/oz and platinum 1.33% to $816.43. Brent crude had fallen 0.43% at $66.14 a barrel.

At the same time, the Dow was flat at 25,867.37 points, while in Europe, the FTSE 100 had fallen 0.56%, the CAC 40 0.31% and the DAX 30 0.23%.

gernetzkyk@businesslive.co.za