Charter adds to JSE’s rough week

The JSE all-share index ended its worst week in 2017 on Thursday, closing as 1.28% lower at 50,831.90 points ahead of the long weekend.

Volumes were large because of the second-quarter close-out in the futures market, with trades amounting to R53bn compared with an average day’s R20bn.

The all share ended the week 2.65% lower as mining stocks were hammered on foreign selling after the release of the latest iteration of the mining charter.

The gold index ended the day 4.93% weaker, platinums lost 4.02% and resources 2.05%.

Market heavyweight Naspers dragged the market down on a disappointing trading update. It expects headline earnings per share to rise from 4% to 10% for the year to March. Core headline earnings per share are set to rise 33% to 39%. Naspers shares closed 2.2% lower at R2,497.87 on Thursday and retreated 6.9% in the week. Steinhoff shed 1.65% to R64.42. The rand was at R12.8531 to the dollar from R12.6835, extending its losses against major currencies as the day progressed.

On Thursday morning, the rand initially strengthened against the greenback despite the US Federal Reserve (Fed) raising interest rates overnight. The Fed increased rates 25basis points and took a hawkish tone. Only some analysts had expected the Fed’s hawkishness.

Markets appeared cautious on this stance because of weak economic data out of the US recently, Rand Merchant Bank analyst John Cairns said.

Market expectations for a third US rate increase in December were only 45%, he said.

Bonds were weaker, with the benchmark R186 last bid at 8.48%, from 8.39%, after having strengthened earlier in the day along with the rand.

Futures tracked the weaker JSE. At 5.55pm‚ the local near-dated, top 40 Alsi futures index was 0.69% lower at 44‚781 points. The number of contracts traded was 28,504, from Wednesday’s 133‚359.