JSE flat as US elections point to split Congress
The JSE was little changed on Wednesday morning, with banks and retailers firming slightly on a stronger rand, although trade is cautious as events in the US continue to unfold.
At 9.30am the all share 0.02% weaker at 54,441.1 points and the top 40 was unchanged. Banks were up 0.5% while gold miners were down 1.09%.
US midterm election results have come in largely as expected, with the Democrats on track to win a majority in the House of Representatives, although Republicans have extended their Senate majority. The “blue wave” predicted by many analysts, however, has failed to materialise.
This outcome has given a degree of security to the administration of US President Donald Trump, analysts said, with the election expected to make it more difficult for the White House to press its agenda.
“Volumes have been high, and equities remain supported, suggesting this outcome is positive for risk since the gridlock outcome ultimately will support the president’s mandate and a higher probability of more fiscal stimulus,” said Oanda analyst Stephen Innes.
The Republican control of the Senate could ensure Trump is emboldened enough to keep pressing ahead with his economic agenda and executive orders, said BK Asset Management MD Kathy Lien.
The rand has performed well this week, holding steady despite the risk in the market, which has supported banks.
Rand hedge British American Tobacco gained 1.61% to R620.82 having slumped 4.23% on Tuesday. AB InBev firmed 1.12% to R1,082.
Group Five firmed 1.74% to R1.17. On Tuesday, the company initially plummeted more than 20%, before recovering to finish at R1.15, or 0.86% lower. It earlier warned shareholders it had failed to meet the October deadline to complete its disastrous Ghanaian power station project, Kpone, which contributed to a R1.3bn loss in its 2018 financial year.
In morning trade gold was up 0.34% at $1,231.07/oz and platinum 0.53% to $874.40.
Brent crude was 0.16% firmer at $71.81 a barrel.
Source: businesslive.co.za
