GDP data disappoint the market

The JSE closed weaker on Tuesday on disappointing GDP data and weaker commodity prices as global markets continued pricing in a US interest rate increase next week.

SA’s GDP contracted 0.3% in the fourth quarter, according to Statistics SA, after 0.4% growth in the third quarter. Mining and manufacturing, which together contribute about an eighth of GDP, were among the main factors dragging down growth.

The economy grew 0.3% in 2016, against a predicted 0.5%.

Platinum and gold prices fell on a stronger dollar, as reflected by weaker platinum and gold share prices.

The rand was at R12.9683/$ from R13.0137/$.

“Market participants are exhibiting an increasing degree of awareness to the overall market environment, with a conservative attitude required in the sessions ahead,” analysts at Momentum SP Reid said.

The all share closed 0.23% lower at 51,377.80 and the top 40 shed 0.19%. The gold index closed 2.93% lower and platinums shed 2.24%. Food and drug retailers lost 1.2%. Banks were 1.08% down and resources lost 0.79%. Property added 0.28%. Sasol closed 0.95% lower at R366. Among golds, DRD Gold fell 6.77% to R5.92. Harmony shed 4.14% to R28 and Sibanye fell 1.69% to R24.96.

Lonmin led the platinum losses, down 9.29% to R14.64. Northam Platinum lost 3.3% to R51.01.

In the banking sector, Nedbank shed 2.23% to R252.24 and Barclays Africa dropped 1.81% to R151.71.

IT company Net1 UEPS was up 0.86% at R174.98. The group, which owns Cash Paymaster Services, may benefit from a contract with the South African Social Security Agency.

Mondi was down 0.34% to R303.01. The group confirmed that the European Commission is conducting an inspection at its Vienna office.

Bonds firmed with the R186 bid at 8.64%, from 8.67% on Monday.

At 5.50pm, the near-dated top-40 Alsi futures index was 0.17% higher at 44,39 points, with 18,891 contracts traded from Monday’s 23,782.