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Published On: Thu, Sep 1st, 2016

JSE closes weaker as retailers lose ground

THE JSE closed weaker on Thursday as retailers lost ground for the second consecutive day with platinum shares the star performers on the day.

Platinum shares rocketed on Impala Platinum’s full-year results with gold shares also gaining.

The all share closed 0.19% lower at 52,631.30 points and the blue-chip top 40 lost 0.20%. General retailers dropped 2.70% and banks were 1.97% weaker. Food and drug retailers shed 1.30%. South African listed property was down 1.23% and financials shed 0.97%. Platinums added 4.95%.

Together with global markets, the all share was consolidating ahead of Friday’s crucial US nonfarm payroll data. A better than expected figure will increase the likelihood of an interest-rate increase in September, which will probably have profound consequences for emerging markets.

Globally, US continuing jobless claims remained low in August as several manufacturing states reported declines in initial claims. Initial jobless claims, however, ticked higher to 263,000 in the week ending August 27 from a previous 261,000 and a consensus expectation of 265,000.

Global sentiment towards emerging markets remains positive although the all share may not benefit from the full extent of the positive mood due to the continued political upheaval in the ANC on the position of Finance Minister Pravin Gordhan.

The Presidency announced on Thursday that Gordhan would accompany President Jacob Zuma to the G-20 summit in China on September 4–5, despite earlier rumours that Gordhan was set to be arrested before the summit.

Among individual shares on the JSE, Glencore rose 3.38% to R34.30, while Sasol closed 1.66% lower at R364.

SABMiller lifted 1.1% to R856.33.

Impala Platinum Holdings rocketed 9.53% to R61.84 after reporting a narrowing of its full-year loss on the day. Lonmin was up 5.91% at R39.45. Among gold stocks Harmony jumped 4.88% to R55.

In the banking sector, Barclays Africa lost 3.96% to R143 and Standard Bank was down 2.19% to R130.23.

Sasfin dropped 7.21% to R61.01 and Santam ended the day 0.90% lower at R220 after reporting its interims to end June on Wednesday. Underwriting margins contracted to 6.4% from 8% due to the drought conditions.

Alexander Forbes plummeted 11.21% to R6.02.

Mr Price shed another 8.66% to R168.50 on its disappointing sales update released on Wednesday, when it lost 15%.

Steinhoff was 2.75% lower at R85.79. The company earlier warned that its annual results to end-June, due next week, would be lower than expected on the devaluation of the pound following Brexit.

Growthpoint shed 2.08% to R24.90 after reporting dividend growth of 6% for the year to end-June on Thursday.

Famous Brands closed 0.41% lower at R151.37 in choppy trade after announcing a takeover of Britain’s Gourmet Burger Kitchen for R2.1bn.

The rand was firmer against the dollar in late trade, having recouped some losses that occurred on Wednesday after SA’s largest asset manager Futuregrowth’s announcement that it would not be lending to six of SA’s state-owned entities.

At 5.41pm, the rand was at R14.6553 against the dollar from R14.7308 at the previous close.

The rand was, however, off its firmest intraday level of R14.5971/$ after activity in SA’s manufacturing sector tumbled in August, supporting forecasts that economic growth would be close to zero in 2016.

Manufacturing is the economy’s fourth-biggest sector.

The seasonally adjusted Barclays Bureau for Economic Research purchasing managers index, released on Thursday, declined by 6.2 index points to 46.3 in August after five consecutive months of gains above 50.

Bonds were firmer in line with the stronger rand. At 5.42pm the yield on the benchmark R186 bond was bid at 8.995% and offered at 8.950%, from 9.020% at the previous close.

South African futures were flat after the JSE closed weaker amid global risk-off trade.

The Dow Jones industrial average was 0.44% softer at the JSE’s close.

At 5.49pm, the local near-dated top-40 Alsi futures index was up just 0.03% at 46,291 points, with 25,354 contracts traded from 26,487 on Wednesday.

With Madeleine van Niekerk