MARKET WRAP: JSE tracks weaker rand

The JSE closed lower on Tuesday and remains on track for its worst month in more than 10 years.

Asian markets improved following US President Donald Trump’s four-day visit to Japan with Trump expressing optimism about trade relations between the two countries. The Shanghai Composite gained 0.61%, Hong Kong’s Hang Seng 0.38% and Japan’s Nikkei 225 0.37%.

At the close of the JSE, the Dow and FTSE 100 were flat with the former at 25,603.03 points; France’s CAC 40 had fallen 0.39% and Germany’s DAX 30 0.32%.

The rand was by far the worst-performing among emerging-market currencies on Tuesday, with its depreciation driven by global and domestic events with the US-China trade war still the major catalyst.

The rand weakened to two-month lows in intra-day trade, reaching R14.71/$. By the JSE’s close it was down 1.81% to R14.6888/$, 1.66% to R16.419/€ and 1.76% to R18.6196/£. The euro dropped 0.13% to $1,1178.

The benchmark R186 government bond was also weaker, with its yield rising 5.5 basis points to 8.45%. Bond prices move inversely to bond yields.

Locally, the unfolding political events leading up to the announcement of cabinet ministers have weighed on the rand. These include the swearing-in of ANC deputy president David Mabuza as an MP and the delay in the announcement of the new cabinet. Markets are closely watching the appointments as there is speculation that President Cyril Ramaphosa may re-appoint some individuals seen as compromised. 

Gold fell 0.52% to $1,278.32/oz and platinum 1.51% to $798.95. Brent crude was down 0.1% to $69.92 a barrel. 

The all share closed 0.1% lower at 54,443.16 points, while the top 40 was unchanged. Gold miners gained 4.74%, the platinum index 4.4% and resources 3.03%. Banks fell 2.49%, on the weaker rand, and general retailers 1.48%.

FirstRand fell 3.9% to R61.79, Standard Bank 2.01% to R189.04, Absa 1.74% to R158.35, and Nedbank 2.52% to R242.48.

Among general retailers, Massmart lost 3.29% to R64, TFG 2.61% to R166.74, Italtile 2.76% to R14.10, Lewis 2.68% to R36.01, and Steinhoff 1.37% to R1.44.

Lonmin jumped 11.86% to R12.07, after its shareholders and those of Sibanye-Stillwater voted overwhelmingly in favour of the latter’s all-share takeover of the former. Sibanye gained 10.29% to R12.43.

Cartrack leapt 14.84% to R17.80, after reporting that its total revenue grew 28% to R1.69bn for the year to end-February.

Astral Foods dropped 4.33% to R163.97, after it said on Tuesday that issues with its water-supply facility in Standerton had cost it at least R85m.

Sasol recovered last week’s losses gaining 3.62% to R369. 

MTN fell 2.51% to R97. It said earlier that it would sell its interests in investment fund Amadeus and online platform Travelstart to global private equity firm HarbourVest.

BHP led gains among the larger diversified miners, adding 3.21% to R341.95. It was followed by Anglo American’s 2.52% gain to R363.56 and Glencore’s 1.4% to R48.41.

Anglo American Platinum rose 3.55% to R679.25, Impala 6.05% to R56.10, and Royal Bafokeng 2.98% to R29.04.

Old Mutual fell 4.51% to R20.34. It has now lost nearly 9% since suspending its CEO Peter Moyo on Friday, due to a material breakdown of trust and confidence.

Rebosis plummeted another 22.47% to 69c as it grapples with a high debt burden.

mjoo@businesslive.co.za