Retail numbers let market down

The JSE closed weaker on Tuesday as the rand firmed against the dollar, pulling rand-hedge stocks lower. Disappointing trading updates weighed on retailers.

The rand’s improvement came with the pound’s drastic rise against the dollar after British Prime Minister Theresa May said the UK would aim for the “greatest possible” access to the single market after Brexit.

Resource shares were lower after Statistics SA released disappointing mining data for November. Output fell 4.2% year on year. A Bloomberg consensus forecast a 0.9% retraction.

Gold shares rose as bullion firmed and investors continued to rely on the sector for its safe-haven status.

The JSE all share eased 0.64% to 52,817.70 points and the blue-chip top 40 eased 0.62%. General retailers shed 2.07% and industrials 0.80%. The gold index added 0.58%.

The share prices of retailers Mr Price and Shoprite were hit by disappointing sales updates, but Cashbuild’s second-quarter numbers pleased the market. Shoprite lost 1.23% to R176.50 and Mr Price 4.79% to R156. Cashbuild rose 2.07% to R345.

The stronger pound boosted stocks with UK exposure. Capital & Counties rose 5.64% to R47.01 and Intu Properties 3.19% to R47.57. Local player Redefine shed 1.76% to R11.15.

British American Tobacco ended 1.57% lower at R770 after it said it had raised its bid for Reynolds 5.6%. Last week’s star performer, Richemont, eased 0.90% to R102.97.

The rand gained against the dollar, firming to R13.4138 in intraday trade. At 6.35pm, it was at R13.4957/$ from Monday’s R13.6908. It was R16.7129 to the pound from R16.4990.

Bonds were little moved because of the currency’s mixed reaction to May’s speech. In early evening trade, the benchmark R186 was bid at 8.66% from 8.65% previously.

Futures lost out on the weaker rand hedges, with the near-dated top 40 Alsi futures index down 0.35% to 46,620 points, with 20,659 contracts traded from 19,162 on Monday.