JSE closes flat in thin trade as ANC land expropriation news dampens market

The JSE closed little changed on Monday after the market struggled to find direction in thin trade, as heavyweight Naspers closed lower after starting the day more than 1% higher.

After a firm opening, sentiment turned negative amid reports that the ANC intended to press ahead with expropriation of land without compensation. The party will test the argument that the Constitution, as it stands, already allows for expropriation of land without compensation.

Trading volumes were low on the day, reaching just over R11.6bn by the close.

Naspers lost some ground after Tencent lost 0.73% in Hong Kong trade, despite global optimism following discussions between the US and China over the weekend which may have helped to avoid an all-out trade war. Naspers owns 31.2% of Tencent.

The Dow was 1.25% higher at the JSE’s close, with European markets also recording gains in upbeat trade.

The global economy remained robust and US first-quarter earnings had been strong, but stock markets had mostly traded sideways this year because many investors had started to fear that the pace of expansion had already peaked, Dow Jones Newswires reported.

General retailers held on to a positive opening, but banks lost out in renewed risk-off trade. Miners ended the day higher on a slightly weaker rand and oil price.

Brent crude was 0.28% lower at $78.39 a barrel.

The all share closed 0.03% up at 57,821.20 points and the top 40 gained 0.04%. Resources rose 1.14%, the platinum index 0.93%, financials 0.23% and general retailers 0.18%. Food and drug retailers lost 1.39%, industrials 0.56%, property 0.5% and banks 0.28%.

Anglo American gained 1.97% to R326.30.

Barloworld slipped 1.89% to R156 after reporting total interim headline earnings a share to end-March rose 32% to 481c.

Pioneer Food dropped 1.01% to R104.36 after it reported interim headline earnings to end-March rose 30% to R592m, from an expected 22%-32%.

Capitec gained 0.96% to R844.63. This despite Viceroy Research releasing another research report accusing the group of continuing to mislead its investors with respect to its financial position.

Steinhoff International plummeted 6.11% to R1.69 as the market mulled the outcome of Friday’s presentation to lenders in London. The group undertook to tackle its huge debt overhang of about R150bn and would provide a further update on June 29 at the latest, it said.

Steinhoff Africa Retail dropped 2.79% to R17.10.

Real estate investment trust (Reit) Dipula’s A-shares lost 0.2% to R10.12 after the group reported its average interim dividend rose 4.6%.

Naspers closed 0.67% lower at R3,180.13.

The top 40 Alsi futures index fell 0.24% to 51,519 points. The number of contracts traded was 16,666 from Friday’s 18,978.