JSE resumes slide as tariff fear grips markets

The JSE started the week on a negative note, with the majority of indices lower on the day and industrial counters and large-cap stocks faring worst.

Global markets in general, most commodity prices and the rand were all under pressure from a spike in risk-off sentiment due to the prospects of further escalation of the US and China’s trade conflict.

The rand slid more than 1% against a resurgent dollar, but rand hedges failed to benefit, although property stocks and gold miners earlier found some support before closing lower. Gold miners had gained from safe-haven interest, while US bond yields were lower on the day.

Local factors took a back seat, but the financial problems of SA’s state-owned enterprises continued to be in the spotlight, with reports that the Treasury had approached the private sector to secure lending.

“The time has come for staffing cuts, restructuring and privatisation … politics in this country is going to get tougher,” Vestact’s Paul Theron said.

A 2% fall in the price of Brent crude provided some relief, as the markets reacted to a deal last week between oil-cartel Opec and Russia that provides for increased production.

The all share fell 1.7% to 55,889.3 points and the top 40 1.81%. Resources fell 2.05%, industrials 1.99% and general retailers 1.77%.

Diversified miner Anglo American lost 3.5% to R292.57, Glencore 2.43% to R67.05 and BHP 2.22% to R290.70.

Kumba Iron Ore slumped 5.33% to R286 after earlier saying it expected headline earnings per share for the six months to end-June to drop at least 20%.

Rand hedge British American Tobacco gave up 1.79% to R683.56 and Richemont 1.68% to R116.49.

Imperial Holdings lost 3.48% to R198.96.

TFG fell 2.17% to R185.84 and Mr Price lost 1.76% to R228.64.

Vodacom lost 2.5% to R123.65, while Telkom gained 1.36% to R49.16.

Ascendis Health rose 3.7% to R10.94, after earlier denying it was involved in the scandal surrounding Public Investment Corporation CEO Daniel Matjila and his alleged lover, Pretty Louw.

Naspers fell 3.04% to R3,207.

Shortly after the JSE closed the Dow was off 1.1% to 24,303.89 points, while in Europe, the FTSE 100 had fallen 2.09%, the DAX 30 1.78% and the CAC 40 1.3%.

At the same time, platinum had given up 1.51% to $865.50 an ounce and gold 0.2% to $1,266.70. Brent crude was 1.79% lower at $74.42 a barrel.