JSE opens lower as Naspers loses ground but MTN recovers

The JSE all share opened weaker on Friday in cautious trade as risk-off trade dominated sentiment.

A weaker Naspers dragged the market down, but MTN recovered somewhat after plunging 19.4% on Thursday following renewed claims by the Nigerian central bank against the company.

Standard Bank, against which similar claims have been made, remained weaker.

The market was looking for direction from the rand, having weakened more than 3% against the dollar in the week. The local currency was steady at R14.72 to the dollar, having stabilised in overnight trade following some marginal recovery in the Turkish lira.

The rand found some support after ratings agency S&P Global Ratings suggested that it was unlikely to downgrade SA. It has recently downgraded Turkey’s sovereign credit rating The International Monetary Fund also gave its full backing to President Cyril Ramaphosa’s land reform plan, as long as the process was transparent and based on the constitution.

However, the outlook for the local currency remains uncertain.

The rand has shown its vulnerability to a plethora of international and local factors, as emerging markets come under sustained pressure, analysts at Nedbank Corporate and Investment Banking said.

“The rand was the third-worst-performing emerging-market currency on Thursday and only the Turkish and Argentinian currencies performed worse, this as both these countries implement various measures in an effort to protect their currencies,” the Nedbank analysts said.

Asian stocks were broadly lower, after a Bloomberg report that US President Donald Trump was pushing ahead with his plan for tariffs on an additional $200bn worth of Chinese goods and threatened to withdraw the US from the World Trade Organisation.

The Shanghai Composite was 0.46% lower and the Hang Seng lost 1.16%.

The Dow closed 0.53% lower on Thursday, slipping below 26,000 points following four straight days of gains, with market participants seen to be reducing risk ahead of a long weekend, Dow Jones Newswires reported. US markets are closed Monday for labour day, as concern about growing trade tension remains high.

EU officials stressed that the US and the EU were not yet involved in official trade talks, saying profound disagreements with the US on trade policies remained a stumbling block. However, European officials nevertheless see a benefit in finding agreement on issues where the EU and the US could work together.

At 10am the all share was 0.4% lower at 58,565.60 points and the top 40 had dropped 0.56%. Industrials shed 0.6%, resources 0.39% and general retailers 0.24%. The gold index rose 2.19%, food and drug retailers 0.86% and platinums 0.5%.

Anglo American slipped 0.9% to R298.66.

Sibanye-Stillwater rebounded 4.99% to R8.42.

Standard Bank was 0.63% lower at R183.83.

Hyprop dropped 0.95% to R103.01. It reported annual distributable earnings to end-June was up 10.5%. The total dividend per share rose 8.8%.

Resilient was 1.16% lower at R56.30 as pressure increased on the board and management to account for the plunge in its share price. Resilient is down 62.62% in 2018.

Nepi Rockcastle lifted 0.61% to R137.90.

MTN was up 2.39% to R88.57.

Naspers lost 2% to R3,282.96.

Advanced Health dropped 10.64% to 42c after reporting annual results on Thursday.

Source: businesslive.co.za