MARKET WRAP: JSE closes weaker as Donald Trump gets trigger happy with tariffs

The JSE closed weaker on Friday in renewed risk-off trade following US President Donald Trump’s decision to impose tariffs of $50bn of Chinese goods.

China then announced retaliatory steps by imposing duties with “equal scale, equal intensity” on imports from the US, escalating trade tension between the two countries further.

Concern about a trade war between the two nations hit emerging market sentiment badly, with European markets also down.

The US decision could become the start of a tit-for-tat series of retaliatory moves, Dow Jones Newswires said.

The International Monetary Fund (IMF) warned on Thursday that the economic boost from 2017’s tax cuts in the US would fade in 2019 and 2020, and the US economy would then slow considerably.

The forecasts provide a sharp contrast to the economic outlook of the White House, which sees growth accelerating to a sustained 3% annual rate within five years. The IMF sees the US growing at about half that pace once the effects of the tax cuts fade.

After the JSE’s close, Fitch Ratings affirmed SA’s junk-status credit rating of BB+, maintaining its stable outlook as expected.

The all share closed 1.43% lower at 57,660.5 points and the top 40 dropped 1.63%. Banks dropped 3.94%, the gold index 2.83%, resources 2.19%, property 1.37% and general retailers 0.96%. The platinum index added 0.2%.

The all share index ended the week 0.97% down.

Anglo American lost 3.41% to R307.25.

Sasol closed 1.37% lower at R479.36 as Brent crude tumbled 3% to $73.5 a barrel.

British American Tobacco gained 0.88% to R667.82.

Standard Bank plummeted 5.23% to R197.10.

Steinhoff International lost 3.2% to R1.21. The group announced it had sold its Austrian Kika/Leiner property interests for €450m and the retail business for €1.

Naspers ended the day 1.08% lower at R3,299.12.

The rand was little changed against major global currencies, with investors cautious as focus shifted once again to issues of international trade.

The rand was at R13.4138 to the dollar from R13.4592 soon after the JSE’s close.

Local bonds were weaker with the R186 bid at 9.02% from 8.93%. The benchmark US 10-year was at 2.9053% from 2.9373%.

The top 40 Alsi futures index lost 1.67% to 51,302 points. It ended the week 1.14% lower. The number of contracts traded was 40,630 from Thursday’s 35,262.