JSE weaker as firm rand hits mines
The JSE weakened on Thursday, with a firmer rand weighing on miners, while banks and retailers managed a relatively strong performance.
The rand was firmer despite a weaker euro, with the common currency under pressure as Italian politicians battle to put a budget together.
The dollar found support, putting pressure on local miners. A 3% fall by Naspers ensured the local bourse closed lower. The all share fell 1.03% to 55,988.6 points and the top 40 1.11%.
General retailers gained 1.46%, food and drug retailers 1.01%, and banks 0.7%. Gold miners slumped 4.71% and industrials 1.49%. Local data on the day was downbeat, with producer inflation printing higher than expected, at 6.3% year on year in August. The economic consensus was for inflation to have moderated slightly to 5.9% from 6.1% in July, with this news coming ahead of the announcement of what could be a fuel-price increase of R1 a litre next week. This comes as the Reserve Bank’s tone has turned hawkish.
While second-round inflationary effects have not come through markedly at the consumer level as yet, the effect of rand depreciation and higher commodity prices is being felt, said Investec economist Lara Hodes.
Diversified miner Glencore fell 3.42% to R61.25 and Anglo American 2.31% to R317.26. Rand hedge AB InBev fell 2.92% to R1,241.61 and Richemont 1.78% to R115.23. Sibanye-Stillwater fell 3.8% to R8.36 with its two biggest unions having been given permission to strike due to a failure to agree on wage increases. Harmony, which is also facing possible strike action, slumped 8.46% to R23.58. Kumba Iron Ore rose 5.42% to R312.79. Mr Price gained 3.77% to R234.99. Steinhoff International lost 4.38% to R2.40, despite reports that its Asia-Pacific unit had refinanced some of its debt.
Long4Life fell 2.48% to R4.72, despite expected headline earnings between 42% and 61% higher.
Netcare plunged 9.42% to R25, after earlier warning that tough trading conditions were weighing on its performance, particularly in SA.
The Dow was up 0.38% to 26,487.25 points. The FTSE 100 had gained 0.38%, the CAC 40 0.54% and the DAX 30 0.46%. At the time, platinum had lost 1.79% to $807.12/oz and gold 1% to $1,182.34/oz. Brent crude was 0.27% lower at $81.41 /barrel.