JSE softens as rand hedges retreat

The JSE lost ground on Wednesday, as gains by banks and property stocks failed to offset losses by rand hedges and retailers. International markets failed to give the local bourse a clear direction, with the rand mixed against major global currencies shortly before the JSE closed.

Miners were under pressure, with Sasol leading losses amid signs of cracks emerging within oil cartel Opec over production cuts. Gold miners pared earlier losses. The precious metal price firmed following the announcement that Rex Tillerson had been fired as US secretary of state.

Tillerson’s departure comes as the US faces the possibility of retaliation from major trading partners over recently imposed steel and aluminium import tariffs.

“So far, trade risks have not been a big risk-off catalyst. Yet a potential escalation into trade wars is arguably the most disruptive geopolitical risk to global expansion and markets in 2018,” said BlackRock’s chief global investment strategist, Richard Turnill. For now, volatility around protectionist measures should be short-lived.

The JSE closed 0.19% lower at 59‚084.50 points and the top 40 lost 0.13%. General retailers fell 1.74%‚ food and drug retailers 1.52%‚ the gold index 1.43%‚ resources 0.76% and industrials 0.32%. The property index rose 0.99%‚ banks 0.77% and financials 0.5%.

Sasol shed 3.04% to R412‚ as Brent crude lost 1.11% to $64.19 a barrel.

British American Tobacco gave up 1.97% to R688.65.

FirstRand added 2.49%, to R70.26 and Capitec 2.81%, to R901. MMI Holdings jumped 3.33% to R22.

Resilient rose 3.22% to R63.48‚ Fortress B 2.13% to R14.41 and Nepi Rockcastle 4.97% to R126.

Tiger Brands fell 2.51% to R349.48‚ bringing losses for 2018 to 24%.

Aspen lost 2.96% to R247.50 on renewed speculation the group might be the target of short-sellers. It was down nearly 10% at one point.

At 5.40pm, the Dow was up 0.2%‚ while European markets were weaker‚ with the DAX 30 off 0.88%‚ the FTSE 100 0.73% and the CAC 40 0.3%. Platinum was up 0.58% to $969.39 an ounce and gold 0.28%, to $1‚326.26.

The top 40 Alsi futures index lost 0.38% to 52‚210 points. The number of contracts traded was 141‚347, from Monday’s 31‚318.