MARKET WRAP: JSE slips in risk-off trade but gold miners shine

The JSE fell on Thursday, tracking weaker global markets, as concerns about the state of the world economy weighed on risk assets.

Global trade was muted, with sentiment dented by weak eurozone economic data on Wednesday, as well as data showing the South Korean economy suffered its worst quarterly contraction since the 2008 financial crisis.

The JSE extended earlier losses as US markets opened, with the Dow posting sharp losses as investors digested corporate-earnings reports.

Losses on the all share were offset slightly by gold miners, who benefited from interest in safe-haven assets.

Food and drug retailers also fared well, mostly due to Shoprite's partial recovery after Wednesday’s 5.62% fall. Shoprite added 3.52% to R174.27. It is engaged in a process that could see the dilution of the voting rights of group chair Christo Wiese.

The all share lost 0.5% to 58,807.1 points and the top 40 fell 0.6%. Gold miners added 1.71% and food and drug retailers 0.86%. Industrials fell 0.75% and the resources index 0.56%.

Shortly after the JSE closed gold was up 0.34% to $1,2780.96/oz while platinum was almost unchanged at $883.27. Brent crude was 0.64% higher at $74.96 a barrel.

Local data earlier was downbeat. Producer inflation, as measured by the annual change in the producer price index (PPI) came in higher than expected, rising 6.2% in March. The market consensus had been for a rise of 5.5%.

US corporate earnings continue to grab much of the market’s attention, with upbeat data pushing US markets to record highs earlier this week. As the JSE closed on Thursday the Dow had fallen 0.88% to 26,365.75 points, while in Europe, the FTSE 100 had lost 0.64%, the CAC 40 0.59% and the DAX 30 0.51%.

Friday sees the release of US first-quarter GDP numbers, which will be closely watched as investors gauge the state of the world's biggest economy.

Trade on the JSE on Friday may be subdued by the truncated trading session. The market is set to close at 3pm, as the bourse is implementing a new trading and clearance system.

Diversified miner Anglo American slumped 2.1% to R379.80.

Rand hedge British American Tobacco slumped 3.32% to R551.07, despite its chair, Richard Burrows, saying at the company’s AGM earlier on Thursday that it expected strong revenue growth in 2019.

AB InBev fell 2.64% to R1,253.

Long4Life jumped 6.11% to R4.86. It said earlier it expected headline earnings per share to rise by between 22% and 32% in the year to end-February.

Naspers fell 1.24% to R3,664.39.

Anglo American Platinum fell 1.51% to R749.59. It said earlier that platinum group metal production fell 14% in the first quarter of 2019 compared to the same period in 2018.

Vunani plunged 21.26% to R2, despite it saying earlier that revenue increased 21% to R425.3m in the year to end-February compared to the prior corresponding period. Profit almost doubled year on year to R7.9m.

gernetzkyk@businesslive.co.za