JSE muted as investors digest US report

The JSE was little changed on Tuesday, with global markets firmer as investors assessed the US consumer inflation report.

The consumer price index (CPI) rose 0.4% in February and 3.2% year over year, with markets expecting a 0.4% increase last month and 3.1% year over year, respectively. Core inflation, which strips out food and energy from the headline reading, climbed 0.4% in February, compared with a forecast gain of 0.3%.

Core CPI, which strips out food and energy prices, rose 0.4% on the month and 3.1% on the year, both higher than estimates.

Inflation and the outlook for interest rates continue to be the main theme in the markets as investors consider when the Federal Reserve will start cutting rates.

Last week, Fed chair Jerome Powell said the central bank was “not far” from getting enough confidence about inflation to begin cutting rates. The Fed has already raised its main interest rate to the highest level since 2001 to bring down inflation, reported Bloomberg.

The CPI report comes before the producer inflation numbers, which will be released later this week. The two inflation reports are among the last major economic reports expected before the federal open market committee ) policy meeting scheduled for March 20.

According to data from the CME Group, markets were pricing in a nearly 100% chance the Fed would keep rates unchanged next week.

The JSE all share and the top 40 were little changed, with the former at 73,484 points. Industrial metals gained 1.28% and industrials 0.85%. Precious metals fell 3.22%, retailers 1.28%, resources 0.69%, listed property 0.79%, food producers 0.51%, financials 0.41% and banks 0.37%.

At 6.10pm, the Dow Jones industrial average was 0.44% firmer at 38,939 points, while in Europe the FTSE 100 added 1.03%, France’s CAC 40 0.88% and Germany’s DAX 1.2%.

Property group Attacq was among the best performing stocks on the JSE on the day, gaining 3.09% to R10 — the biggest one-day gain in almost a month, after the company said it has sold its stake in MAS Real Estate for nearly R800m. This has bolstered the company’s capital structure after reducing its debt pile by about R2.5bn at end-December.

At 6.16pm, the rand was little changed at R18.6643/$ and R20.3765/€, while it had strengthened 0.11% to R23.8571/£. The euro was little changed at $1.0917.

Gold lost 0.93% to $2,162/oz and platinum 1.15% to $921.81/oz. Brent crude was 0.53% firmer at $82.62 a barrel.