JSE heads south as resources and banks weigh
The JSE was weaker on Monday as resources fell further, along with banks, while individual domestic industrial stocks bucked a weaker trend.
The all-share was down 0.65% to 73,754.04 in early afternoon trade, as platinum group metals (PGMs) and resource counters, in particular, battled to attract short-term support, despite having fallen dramatically in recent months.
Investors also trimmed their exposure to banks, which until now have shown resilience, despite recent market volatility and long-standing economic growth concerns. The banking index shed 1.47%.
However, equity markets across the globe appear to be in a holding pattern following the wobble in the first week of the new year. Even so, Japan’s Nikkei 255 is the rose among the thorns, with its index trading at its best level since early 1990.
In commodity markets, Brent crude was marginally lower at $77.71 a barrel, despite concerns of potential supply disruptions due to rising geopolitics in the Middle East.
Last week, the UK and US reportedly launched co-ordinated military strikes against Houthi militants in Yemen after the latter attacked shipping vessels in the Red Sea.
“My concern for the immediate future is that someone or some group will cause the closure of the Suez Canal,” independent analyst Liston Meintjes said.
“That will cause a much bigger disruption than a few large shipping companies [already] deciding that it is better to divert some ships to go around the Cape. But that is only suitable for some cargoes and for those where the orders are not ‘urgent’.”
Meanwhile, foreign investors sold just less than R4bn of SA stocks over the past week, according to the JSE’s weekly data, but bought R6.4bn worth of local bonds over the same period.
The rand was marginally lower at R18.68/$ in early afternoon trade, having lost 7.7% in 2023.
Source: businesslive.co.za
