Miners lead JSE to a lower close
The JSE closed lower on Tuesday, with miners leading losses as global markets await Brexit developments.
British MPs are debating the withdrawal agreement bill after stalling Prime Minister Boris Johnson’s Brexit deal at the weekend, forcing him to request a Brexit deadline extension.
The rand strengthened to its best level in more than a month in intra-day trade on Tuesday bolstered by optimism in the US-China trade talks.
Chinese vice-foreign minister Le Yucheng said that the two countries made some progress in trade talks. Reuters reported on Tuesday that China offered 10-million tonnes of tarifffree quota to major Chinese and international soybean crushers to import soybeans from the US.
At 5.56pm, the rand had firmed 1.01% to R14.6104/$, 1.09% to R16.2752/€ and 1.12% to R18.9152/£. The euro weakened 0.11% to $1.114. Gold was flat at $1,484.71/oz. Platinum added 0.29% to $890.39. Brent crude was 1.12% higher at $59.70 a barrel.
The Dow was up 0.15% to 26,856.30 points. In Europe, the FTSE 100 gained 0.68% and Germany’s DAX 30 0.12%. France’s CAC 40 was flat. The Shanghai Composite rose 0.5% and Hong Kong’s Hang Seng 0.23%. Tokyo was closed for a public holiday.
Locally, the leading business indicator fell to 103.8 in August from 103.9 in July, data from the Reserve Bank showed on Tuesday. The median forecast was for the indicator to have fallen to 103.7, according to Bloomberg.
SA is probably seeing its business cycle begin to trough, said Investec economist Annabel Bishop. “While this may prove a fairly patchy and lengthy experience, the business cycle should eventually begin to notably turn up in SA, absent a marked further slowdown in global economic activity, and clearly also barring a global recession.”
The JSE all share fell 0.31% to 55,936.80 points and the top 40 0.45%. Gold miners dropped 3.46%, the platinum mining index 2.92% and resources 2.16%.
Standard Bank rose 0.86% to R181.34 after saying it wrote down its stake in the Industrial and Commercial Bank of China joint venture by R2.4bn, citing deteriorating market conditions.
Pick n Pay leaped 10.54% to R67.98, its highest level in nearly four months. Its trading profit rose 12.5% to R1.187bn in the 26 weeks to end-September.
Anglo American fell 1.03% to R369.72, despite a 4% rise in thirdquarter output, thanks to the ramp-up at Minas-Rio and strong performance at its metallurgical coal division.
Ascendis Health fell 4.31% to R4.44. It warned of a headline loss from continuing operations of R475m to R495m for the year to end-June.
Statistics SA is due to issue the September consumer price index on Wednesday. Bloomberg’s median forecast is for no change in consumer inflation after August’s 4.3%.