MARKET WRAP: JSE slips in subdued trade with miners faring worst

The JSE ended Monday slightly weaker, as mining shares dragged the overall market down, with industrials failing to build on earlier momentum in thin trade.

Volumes were low, at R9bn, with US and UK markets closed for holidays — Memorial Day in the US and the UK Spring bank holiday.

French and German markets were lower as the Italian political crisis intensified. Italian President Sergio Mattarella blocked the ascent to power of a government supported by the maverick 5-Star Movement and the hard-right League after they proposed a eurosceptic figure as economy minister, Dow Jones Newswires reported.

Oil prices continued to fall with Brent crude 1.27% lower at $75.16 a barrel.

Recent comments from Russian and Saudi officials on the readiness to ease their restrictions on production as soon as next month appeared to be the main factor forcing oil prices lower, FxPro analysts said.

The all share closed 0.11% lower at 56,857.20 but the top 40 gained 0.02%. The platinum index dropped 2.35%, gold 1.85%, general retailers 0.65%, property 0.5% and resources 0.45%. Food and drug retailers added 0.24% and industrials 0.17%.

Sibanye-Stillwater lost 1.84% to R7.45 and Lonmin 5.9% to R6.70.

Steinhoff Africa Retail slumped 5.59% to R16.90, ahead of the release of its interim results to end-March on Tuesday. The company said on Friday it expected earnings to plunge 52%.

Telkom shed 3.6% to R51.70, after saying earlier it had grown overall revenue by 0.1% to R41bn in the year to end-March, but operating profit dropped 6.5%.

The rand was lifted slightly by S&P Global Ratings’ decision to leave SA’s debt rating unchanged on Friday, as expected, while much of the global focus was on a wobbling euro. The euro was last at $1.1626 from $1.1687.

The rand was at R12.4382 to the dollar from R12.4897.

S&P kept its rating on SA unchanged, citing tentative economic growth and the government’s rising debt burden as factors mitigating against an improved rating. The outlook remains stable.

In response, National Treasury said it would talk to S&P about their areas of concern.

Local bonds found support from the firmer rand, having been back in favour with global investors last week.

Foreigners purchased a net R3bn of local government debt last week, according to JSE market statistics.

The benchmark R186 government bond was last bid at 8.435% from 8.45%.

The top 40 Alsi futures lost 0.12% to 50,761 points. The number of contracts traded was 10,796 from Friday’s 17,901.