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Johannesburg - Investors on the JSE were more circumspect on Tuesday as the world waits for the Greek parliament’s reaction to the deal the country’s government concluded with the European Union to keep Greece in the eurozone.
Major indices on the JSE were moderately lower on Tuesday for the first time in five trading days as investors adopt a wait-and-see attitude to events in Greece.
By midday on Tuesday the All-share index was 0.39% lower at 52 271 points, while the Top 40-index was 0.48% softer at 46 685. Some of the losses can be attributed to profit-taking.
All the austerity measures demanded by the European Union - which in effect means that the Greek government will lose control over its own fiscal policy for at least three years - must first be approved by the Greek parliament for negotiations on a bailout for Greece to continue.
Prime Minister Alexis Tsipras however faces a showdown with rebels in his own party, as they are furious at his capitulation to demands for one of the most sweeping austerity packages ever demanded of a eurozone government.
READ: Tough conditions for Greece under eurozone deal
The JSE took its lead on Tuesday morning from the markets in Europe, which were moderately lower after four days of gains.
Imara SP Reid said in its daily Market Snapshot on Tuesday that some profit-taking can be expected, after substantial percentage gains were recorded in each of the past four sessions.
“The Top 40-index effectively rallied more than 2 500 points without a single meaningful value retracement. Slightly more circumspect traders would use the exceptional short term strength as an opportunity to book some of the brisk trading profits which have occurred,” the company said.
The biggest loser on Tuesday was the Financial index, the frontrunner of the past few days, which was 1.10% lower by midday.
There was some serious profit-taking in the sector and FirstRand [JSE:FSR] lost 1.86% to R71.58, while Standard Bank [JSE:SBK] was 2.12% lower at R158.91. Barclays Africa [JSE:BGA] was however only 0.46% softer at R187.56.
Among the insurance companies Sanlam [JSE:SLM] traded 1.58% lower at R71.79, while Old Mutual [JSE:OML] lost 1.18% of its value to trade as R41.87.
There was brisk trade in the shares of South Africa’s two cellphone giants, with Vodacom [JSE:VOD] 2.95% weaker at R134.90 and MTN [JSE:MTN] losing only 0.11% to R216.41.
The share price of Naspers [JSE:NPN] was quite volatile on Tuesday morning but by midday the share traded 0.54% higher at R1 879.98. SABMiller [JSE:SAB] was 0.07% stronger at R617.28.
Sasol [JSE:SOL] was a victim of the lower oil price and lost 1.48% to R425.50. The price of Brent crude dropped as low as $56.77 a dollar in reaction to indications that the US and Iran were close to a deal on nuclear weapons, which will lead to the end of sanctions against Iran.
