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JSE investors eye data, Nkandla report

Johannesburg - The JSE went into wait-and-see mode on Wednesday as traders and investors awaited data and news releases, including the long-awaited findings of the Nkandla report‚ retail sales and local inflation dataas well as the Federal Reserve monetary policy announcement.

Major indices were mostly slightly down by midday, following Tuesday's All Share index close again above the 47 000-level.

The All Share index slipped below 47 000 again and was by midday 0.23% lower on 46 952 and the Top 40-index lost 0.28% to 42 274. Both the Industrial and Resources indices traded 0.66% lower.

The only exception was the Financial 15-index which improved with 1.2% by midday, with Sanlam [JSE:SLM] 1.6% higher on R53.68 and Old Mutual [JSE:OML] 2.24% stronger on R34.76.

Amongst the banks Barclays Africa [JSE:BGA] traded 1.62% higher on R143.98 and FirstRand [JSE:FSR] was 1.36% better on R34.98.
 
Most of the attention was on the consumer price index released on Wednesday morning as higher inflation would increase the likelihood of a rate hike at next week’s monetary policy committee meeting and place the rand in a favourable light from an interest-rate differential. Higher interest rates and a stronger rand are favourable for financial shares.

Imara SP Reid warned however that banking shares were overbought.

Barclays Research also said in a note that all eyes are on the US Federal open market committee meeting taking place in the evening. They expect continuity in the tapering of the Fed’s economic stimulus programme and more efforts to reassure the markets that tapering is not tightening.

At midday, the rand was at R10.7240/$ from Tuesday’s close of R10.7314.

The American markets closed higher on Tuesday despite the news that Russian President Vladimir Putin signed a treaty making Crimea part of Russia, which heightened tensions with Western Europe and the United States, which accused Moscow of an illegal land grab.

Market players were encouraged by the fact that Putin said Russia had no plans for a larger break-up of Ukraine.

The mood deteriorated on Wednesday morning and put a damper on Asian markets after soldiers were killed on both sides following a shoot-out in Crimea.

The Industrial index was again pulled lower by media giant Naspers [JSE:NPN] which traded 4.2% lower at R1 168.70 at midday. The share recovered more than 4% and closed higher on Tuesday for the first time in four sessions. On Wednesday it gave back almost all those gains.

Imara SP Reid also said that resources shares are now oversold, as the index started its correction around levels of 58 000 points. Anglo American [JSE:AGL] was another 0.11% lower on R256.11, while Glencore Xstrata [JSE:GLN] lost another 1.24% to R54.75, despite news that its partner in Chad will export its first cargo of crude oil from the Central African country in late March.

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Rand - Dollar
18.89
+0.2%
Rand - Pound
23.82
+0.4%
Rand - Euro
20.37
+0.3%
Rand - Aus dollar
12.30
+0.3%
Rand - Yen
0.12
+0.2%
Platinum
908.05
0.0%
Palladium
1,014.94
0.0%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
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