JSE eases on second downgrade

The JSE closed marginally lower on Friday after Fitch became the second ratings agency in a week to downgrade SA to junk status amid huge nationwide protests calling for the resignation of President Jacob Zuma.

Banks and financials recovered by the close, with gold and platinum shares the top gainers.

The rand was stable at R13.80/$ for most of the day as the market took an optimistic view of the growing antiZuma sentiment, set to reach a high point when Parliament votes on a no confidence motion on April 18.

Momentum economist Sanisha Packirisamy said Fitch raised much of the same concerns as S&P Global Ratings last Monday, when it became the first to downgrade SA.

The Treasury said that Fitch’s announcement was a setback, but noted that Fitch foresaw higher economic growth for SA in 2017.

The all share closed 0.12% lower at 52,853.40 and the blue chip top 40 ended the day 0.18% down. Resources dropped 0.72% and property shed 0.29%. Industrials were flat (-0.04%). The gold index rose 3.79% and platinums gained 2.03%. Banks added 0.39% and food and drug retailers ended the day 0.31% up.

The all share ended a choppy week 1.53% higher. It is 4.34% up for the year so far.

Anglo American was 3.14% lower at R208.59. Kumba Iron Ore dropped 4.19% to R214.65.

Among gold stocks Gold Fields rose 6.3% to R53. AngloGold Ashanti was up 3.84% to R170.81.

Among platinums Anglo American Platinum added 4.4% to R358.24.

Barclays Africa led the big banks higher, gaining 2.29% to R138.91. Standard Bank rose 0.53% to R137.20, but FirstRand softened 0.22% to R44.80.

Local bonds were firmer despite the Fitch downgrade. In late trade, the yield on the benchmark R186 was 8.95% from Thursday’s 9.00%.

At 5.48pm, the local near-dated top 40 Alsi futures index was 0.07% higher at 46‚820 points. The number of contracts traded was 28,825 from Thursday’s 25,069.