MARKET WRAP: JSE weakens amid US-China trade talks

The JSE edged lower on Thursday, amid mixed global markets, as investors waited for new developments on trade talks between the US and China.

There was little international or domestic news to give the local bourse any direction, with investors seeming content to take profits after two days of strong gains on global markets.

Though global sentiment is still somewhat positive, many investors are unwinding their positions, having possibly been over-zealous in expecting continued loose monetary policy, said SPI Asset Management head of trading Stephen Innes.

The rand lacked a clear direction on the day, and was 0.23% firmer at R14.1149/$ as the local share market closed.

US and China officials have indicated they are close to ending their trade dispute, having slapped billions of dollars’ worth of tariffs on each others’ goods in 2018. US President Donald Trump may announce a meeting with his Chinese counterpart Xi Jinping later, as he is scheduled to meet with that country’s vice-premier on Thursday.

The all share fell 0.37% to 57,711 points and the top 40 0.37%. The resources index gave up 1.37% and food and drug retailers 1.29%. Platinums added 0.91%.

Platinum had risen 3.07% to $896.19/oz while gold was down 0.2% at $1,287.25. Brent crude was 0.3% lower at $69.24 a barrel.

Diversified miner BHP was down 2.05% to R350.66 and Anglo American 2.01% to R394.63.

MTN added 2.92% to R92.37.

KAP Industrial gained 0.84% to R7.17. Earlier it said that two of its board members, who were Steinhoff executives, had resigned.

Premier Fishing was unchanged at R3. It said earlier it expected headline earnings per share (HEPS) for the six months to end-September to rise by between 20% and 30% from the prior comparative period. The results are expected during the course of next week.

International markets were mixed, and as the JSE closed the Dow was up 0.48% at 26,346.7 points, although the tech-heavy Nasdaq had lost 0.23%.

In Europe, the FTSE 100 had fallen 0.23% and the CAC 40 was flat, while the DAX 30 had gained 0.29%.

Gains by the export-heavy DAX 30 came despite data showing earlier that headline factory orders contracted by a surprise 4.2% in March compared to February. German growth should pick up by the middle of the year, although risks remain, including the possibility of the US imposing tariffs on automobiles from the EU, said Barclays Research analysts.

US jobs numbers on Friday will be closely watched, amid intense scrutiny of the state of the world’s largest economy.

Brexit developments also continue to offer the markets some direction. UK Prime Minister Theresa May met with opposition leader Jeremy Corbyn on Wednesday, as she seeks to garner support for her draft deal for the UK’s exit from the EU.

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