JSE opens lower as Nigerian claims hit MTN and Standard Bank

After 10 consecutive days of closing higher, the JSE all share opened lower on Thursday after new threats by the Nigerian central bank rocked MTN and Standard Bank.

The Nigerian central bank is effectively claiming R140bn from the two South African blue-chip companies.

MTN plunged more than 15% after the group announced on Thursday morning that it had received a renewed claim from the Nigerian central bank for $8.1bn in dividends to be refunded to the central bank.

“MTN Nigeria strongly refutes these claims,” the group said.

At 9.40am MTN shares were down 17.26% to R188.81.

Standard Bank lost 1.97% to R185.79 after the group said its Stanbic IBTC subsidiary in Nigeria had also received a claim from the Nigerian central bank, demanding $2.6bn for funds repatriated on behalf of clients.

The central bank is also claiming approximately R75m, or $5.2m, for violations of the laws and regulations relating to foreign-exchange transactions in Nigeria.

“Standard Bank intends to engage with the Nigerian central bank in relation to the issues it has raised,” the bank said.

Trade concerns and negative sentiment towards emerging markets affected the overall JSE and Asian markets were weaker, despite an upbeat performance from the Dow in the previous session.

The Dow closed 0.23% up on Wednesday but the Hang Seng lost 0.84% in Thursday trade.

Investors are concerned that the increases in US tariffs on Chinese goods will take place soon, possibly as early as September, FxPro analysts said.

“At the same time, the level of negotiations does not allow us to hope that these tariffs might be avoided,” they said.

Emerging markets were generally under pressure as the Argentinian peso fell to record lows after the authorities requested that the International Monetary Fund (IMF) speed up disbursements from its agreed credit line.

“Locally, politics remains a major theme, as well as the ongoing woes of the state-owned enterprises,” Nedbank Corporate and Investment Banking analysts said.

Naspers was lower on the weaker trade in the East and despite upbeat sentiment towards tech stocks. Morgan Stanley raised its target price for Amazon and Alphabet, helping the tech giants gain 3.4% and 1.5% respectively.

Property, banking and financial shares were lower on a weaker rand, while Steinhoff continued to recover.

The rand was at R14.5406 to the dollar from R14.3497.

The all share was 0.48% lower at 59,874.60 points and the top 40 lost 0.6%. Resources dropped 0.64%, industrials 0.62%, banks 0.46% and general retailers 0.35%. Food and drug retailers rose 0.5% and property 0.39%.

Naspers was down 1.12% to R3,535.44.

Anglo American lost 1.21% to R296.10 but Sasol gained 0.56% to R564.99.

Santam added 0.99% to R303.99. The group reported that headline earnings per share (HEPS) increased 72% for the six months to end-June. The interim dividend was up 8%.

Mr Price dropped 0.49% to R238.59. It said in a trading update for the first four months of the year ending March 2019 that total retail sales of R6.9bn were 6.5% higher than in the previous corresponding period in 2017.

Advanced Health rose 2.17% to 47c. Revenue increased by 32% to R409m for the year to end-June. This is largely attributed to the increase of 41% in patient numbers, both in SA and Australia.

Steinhoff rose 4.73% to R2.88.

Growthpoint dropped 0.97% to R25.25 but Nepi Rockcastle rose 0.13% to R135.54. Both reported results on Wednesday.

Curro Holdings dropped 1.41% to R31.55, bringing losses for the year to 25.6%.

Source: businesslive.co.za