JSE down after run as rand firms

Business Day - - MARKETS - Maarten Mit­tner Mar­kets Writer

The JSE closed weaker on Thurs­day — its first day of losses in 10 ses­sions, dur­ing which it reached six record highs — as in­dus­tri­als and min­ers pulled back on the firmer rand.

Lo­cal data were up­beat. Min­ing pro­duc­tion in­creased by a sig­nif­i­cant 6.9% year on year in Au­gust‚ after in­creas­ing 0.9% year on year in July.

An­a­lysts had ex­pected a con­trac­tion‚ but this was mainly from a high base in Au­gust 2016. The re­lease has raised ex­pec­ta­tions for SA’s eco­nomic per­for­mance in the third quar­ter.

Re­tail­ers, banks, fi­nan­cials and prop­erty stocks gained on the day after the rand strength­ened 0.40% to the dol­lar to R13.4535, its best level so far in Oc­to­ber.

Min­utes re­leased by the US fed­eral open mar­ket com­mit­tee were in­ter­preted by mar­kets as be­ing rather dovish, after some pol­icy mak­ers ex­pressed reser­va­tions about the out­look for in­fla­tion.

An­a­lysts said this might sig­nal a rate in­crease in De­cem­ber, but also called into ques­tion three pen­cilled in by the US Fed­eral Re­serve for 2018.

Mixed Euro­pean mar­kets and a soft open­ing on the Dow added to the sub­dued sen­ti­ment on the JSE, with vol­umes hit­ting R15bn by the close, lower than the daily av­er­age of R20bn.

The all share closed 0.04% lower at 57,747.30 points and the blue-chip top 40, 0.17%. Plat­inums lost 1.46%, the gold in­dex 1.16%, re­sources 0.73% and in­dus­tri­als 0.15%.

Gen­eral re­tail­ers added 1.36%, food and drug re­tail­ers 1.05%, banks 0.94%, fi­nan­cials 0.80% and prop­erty 0.42%.

In­vestors on the day ap­peared ready to be­gin light­en­ing their ex­po­sure to a few coun­ters that had en­joyed a de­cent run in the past nine trad­ing days.

Aspen Phar­ma­care was the best per­former among blue-chip com­pa­nies, adding 4% to R319.19.

Rand hedge Bri­tish Amer­i­can To­bacco dropped 1.4%, to R864.32 and Richemont 1.08%, to R123.74.

Gold Fields lost 2.88%, to R54.36 and An­glo-Gold Ashanti 1.17%, to R125.66. Trad­ing ex-div­i­dend Har­mony added 0.69%, to R24.83.

The rand held steady at firmer lev­els in late trade, last seen at R13.4737 to the dol­lar. Bonds strug­gled to hold on to firmer lev­els de­spite the re­cov­ery in the rand. The bench­mark R186 was last bid at an un­changed 8.68%.

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