Banks lead losses after rand sell-off

The JSE pared earlier losses to close little changed on Wednesday, having tracked lower global markets for much of the day, as trade war concerns dulled risk-on sentiment.

Local banks led the losses, following a sharp sell-off of the rand overnight. This came after news that the ANC had decided that constitutional changes to allow expropriation of land without compensation were necessary.

Global stocks were lower after the US indicated it may need to up tariffs on Chinese goods in the wake of a depreciation of the yuan. Domestic data was somewhat upbeat, with the Absa purchasing managers’ index for July coming in at 51.5 index points, sharply higher than June’s 47.9. “This suggests the manufacturing sector got off to a good start in the first month of the third quarter of 2018,” Absa said.

Most indices on the local bourse perked up as US markets opened, with stock exchanges there lifted by an upbeat earnings report from tech giant Apple, whose share price hit a record high. This helped lift Naspers, which ended the day 0.84% firmer at R3,269.14. Naspers’s Hong Kong-listed associate, Tencent, has been under pressure from a sell-off in tech stocks.

The all share fell 0.06% to 57,399.50 points and the top 40 0.07%. Banks fell 0.6% and resources 0.75%. Industrials added 0.45%, and platinums 1.48%.

Diversified miner Glencore fell 2.93% to R56.07 and BHP 2.19% to R295.53. ArcelorMittal SA jumped 14.37% to R3.66, after reporting a 19% growth in revenue, to R23bn, for the six months to end-June.

Woolworths gained 2.21% to R52.29. Vodacom slipped 2.65% to R136.53. Liberty Holdings firmed 0.78% to R116.40 ahead of results for the six months to end-June on Thursday. In the prior period, the group declared an interim divided of R2.56.

At 5.30pm, the Dow was flat at 25,413.97 points, while in Europe the FTSE 100 had fallen 1.08%,the DAX 30 0.22% and the CAC 40 0.19%. At the same time, platinum had slumped 2.58% to $815.29 an ounce and gold 0.54% to $1,217.28. Brent crude was 1.66% lower at $72.84 a barrel.

The top 40 Alsi futures index fell 0.58% to 51,055 points. The number of contracts traded was 14,674 from Tuesday’s 16,468.