Barloworld outstrips a weaker JSE

Metals pushed the JSE lower on Monday, while the rand extended the previous session’s losses as investors watched Israel-Iran developments.

Barloworld bucked the trend on the JSE with its share price having its biggest rise since September 2021, after the company said it had entered into discussions, which if successful may have a material effect on the share price.

The group, with interests such as industrial equipment, services and consumer industries, did not elaborate on the nature of the discussions that prompted the cautionary announcement.

But Barloworld advised shareholders in a statement on Monday to exercise caution when dealing in the company’s securities until a full announcement was made. The group’s share price leapt 10.26% to R79.54.

Iran launched hundreds of drones and missiles at Israel on Saturday night in the first direct attack on Israel from Iranian territory. Most of the drones and missiles were intercepted.

Now there is concern that Israel will retaliate.

If Israel does retaliate it could be the biggest escalation of tension in the region since the outbreak of the IsraelHamas war in October 2023.

“Markets are on edge as traders await Israel’s response to Sunday’s attack by Iran,” said TreasuryONE currency strategist Andre Cilliers.

“Developments in the Middle East over the next few days are likely to remain the main focus and driver for currency moves and keep the dollar on the front foot.”

The rand weakened to an intraday low of R19.0529/$, its worst level in more than two weeks. At 7.13pm, it had weakened 0.63% to R18.9786/$, 0.56% to R20.1851/€ and 0.83% to R23.6463/£. The euro was little changed at $1.0635. The JSE all share lost 1.05% to 74,518 points and the top 40 1.24%. Precious metals fell 4.76%, resources 3.31% and industrial metals 0.37%.

Geopolitical tension saw the price of Brent crude rise to the highest level since October on Friday at $92.14 a barrel. At 6.05pm local time on Monday, it was 0.43% weaker at $89.18 a barrel, having touched an intraday high of $90.62.

US inflation reports last week added another layer of concern to global markets with stubborn prices muddying the interest rate outlook.

“Markets are still trying to gauge the risk to oil supply in the wake of Iran’s widely expected attack on Israel, and the impact on inflation,” said Cilliers.

At 6pm, the Dow Jones industrial average was 0.4% firmer at 38,138 points, while markets were mixed in Europe.