JSE closes flat as domestic market seeks direction on policies by Trump

THE JSE closed marginally weaker yesterday in fairly directionless trade‚ amid market uncertainty about whether the weaker dollar and firmer US treasuries could herald further market scepticism over Donald Trump’s economic policies.

Volume traded – at R13.2-billion – was lower than average. The dollar has firmed and US treasuries have weakened since Trump’s election‚ as the market bought into his fiscal stimulus and growth stance.

However‚ yesterday the dollar weakened against the euro‚ and the 10-year US treasury was at 2.3172% from 2.3548%. It was at 1.8% before Trump’s US presidential election.

The marginally weaker dollar had caused the rand to firm more than 20c against it‚ with rand hedges softening in response. Miners took their cue from higher commodity prices.

Global market sentiment was positive following the primary defeat of Nicolas Sarkozy in the French presidential election‚ resulting in French equity markets firming. Uncertainty surrounds next year’s election‚ with right-wing candidate Marine le Pen a strong contender.

German markets found support from incumbent Angela Merkel’s announcement that she would seek a fourth term in next year’s election.

The JSE all-share was 0.06% weaker‚ at 50 596.5 points‚ while the bluechip Top 40 lost 0.11%. General retailers closed 1.19% lower‚ industrials 0.72% and platinums shed 0.7%. Banks added 1.27% and resources firmed 1.5%.

Retails were under pressure. General retailers had fallen 20% and food and drug retailers 10% since the start of the year.