Chinese tightening squeezes JSE

The JSE closed weaker on Friday as miners retreated on a surprise step by the Chinese authorities to increase short-term interest rates.

The tightening step could harm GDP growth in China but was an indication that the authorities were serious about curbing capital outflows, although the increases were modest, analysts said. Mining stocks have been supported by expected strong growth in China.

The rand was stronger in late afternoon trade after the dollar came under pressure from a US payrolls report. Although better than expected, the report flagged weakness in wage growth, which may keep the Federal Reserve from raising interest rates. The data showed that another 227,000 seasonally adjusted jobs were created in the US in January, exceeding expectations of 175,000. However, the unemployment rate in January ticked up to 4.8% from 4.7%.

At 6pm, the rand was quoted at R13.2224 against the greenback from R13.3960 at its previous close.

The JSE all share closed 0.86% lower at 52,265.20 points and the blue-chip top 40 dropped 0.97%. Platinums slumped 4.05% and resources 2.85%. The gold index shed 1.55% and industrials 0.42%. Property added 0.21% and financials 0.13%.

Among miners, Anglo American lost 4.56% to R222.35, Glencore shed 5.49%, to R51.85 and BHP Billiton retreated 3.87%, to R232.31. Sibanye Gold was 3.69% lower at R30. The group earlier announced it expected gold production to be unchanged for the six-month period to December compared with the first half of 2016.

Impala Platinum slumped 6.57% to R51.20 and Lonmin 3.82%, to R21.66.

Kumba Iron Ore plummeted 7.96%, to R196.05. The group said it was due to pay additional tax of R2.5bn.

Naspers ended the day 0.48% off at R2,187.63.

The bond market was little changed in the late afternoon. The yield on the benchmark R186 steady at 8.840%.

Futures ended lower in line with the JSE. At 5.50pm, the near-dated top 40 Alsi futures index was 0.73% lower at 45,779 points.