JSE kicks off week on negative note as banks take a breather

The JSE was weaker on Monday morning as banks could not sustain Friday’s strong performance on mixed Asian markets. This is ahead of the release of numbers from prominent technology companies, including Google, Facebook and Amazon, this week.

The Dow closed flat on Friday. The Nikkei 225 shed 1.33% on Monday morning, but the Shanghai Composite gained 1.07% and the Hang Seng 0.05%.

Sentiment toward emerging markets was cautious after US President Donald Trump launched a strong attack on Iran through twitter, warning the country it would ” suffer consequences the likes of which few have ever suffered before”.

The all share ended last week 1.11% higher, the first positive closing in three weeks, after recording gains in the last four trading days of the week. The banking index ended the week 2.52% higher.

Naspers fell 1.93% to R3,381.96 on Monday morning amid renewed criticism levelled against the group after it was disclosed that CEO Bob van Dyk had received a share bonanza of R1.6bn.

Shareholders have been clamouring for Naspers to increase its dividend payouts, with profits in the group almost exclusively coming from Chinese internet and gaming group Tencent. Naspers is down 1.68% in 2018.

The weaker rand failed to boost miners and rand hedges at the opening amid investor uncertainty linked to Trump’s continued erratic pronouncements, among which an accusation against China that it was manipulating its currency. Earlier, he threatened to impose higher tariffs on all Chinese imports to the US.

“The double whammy of a stronger dollar and now the weaker Chinese yuan casted a shadow over financial markets, and had led to losses in the rand and other emerging market currencies,” Nedbank analysts said.

The rand was at R13.4596 from R13.4147.

On Friday, Trump took aim at the US Federal Reserve’s interest-rate increasing cycle, rarely done by any sitting US president — they have respected the Fed’s independence in the past.

Brent crude was marginally up at $73.147 a barrel and platinum and gold prices were slightly weaker.

At 10.03am the all share was 1.2% lower at 56,308.50 points and the top 40 lost 1.38%. Banks dropped 2%, industrials 1.47%, food and drug retailers 1.34% and financials 1.03%.

Property rose 0.05%.

Sasol slipped 0.74% to R499.14, and Richemont dropped 1.28% to R117.31.

Harmony jumped 2.37% to R21.60 after saying the addition of Moab Khotsong as part of a $300m deal with AngloGold Ashanti boosted the group’s full-year gold output.

Anglo American Platinum (Amplats) shed 0.49% to R354.15. It declared a R1bn dividend on upbeat interim financials.

Absa lost 3.22% to R156.77 and Standard Bank 2.16% to R194.77.

Steinhoff shed 9.6% to R2.92% and Shoprite 1.5% to R204.25.

Nepi Rockcastle firmed 0.51% to R166.90.