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READ: Spending growth quickens, deficit narrows
Shortly after midday on Monday the major indices were almost the same as at Friday's closing levels, although there was a drop of about 0.6% in the All-share index shortly after the opening which was mostly made up by midday.
In fact, when the rand fell through the roof shortly after 11.00 on Monday morning after the news of the bigger than anticipated deficit, the share market hardly moved. Most of the JSE's losses earlier in the day had already been recovered.
By midday the All-share index was only 0.13% lower at 49 442 points and the Top 40 index was still above the important resistance level of 43 600 points trading at 43 813 points, just 0.14% lower than Friday.
The Gold index was 1.56% down, trading again below $1 200 per ounce, but the other indices were also only marginally different. The Financial index improved by 0.16% but the Industrial index was 0.2% lower. The volatile Resources index lost only 0.18%.
The mood on the JSE was almost like a calm before the storm expected later this week, when rating agencies Fitch and Standard & Poor's will announce their latest summaries of the state of the South African economy which will give a good indication if more credit rate downgrades are in the pipeline.
The news of the bigger deficit will not be well received by the international financial community. The South African Reserve Bank announced in its latest quarterly report that the deficit on South Africa's current account narrowed to 6.0% of gross domestic product in
the third quarter of the year from a revised shortfall of 6.3%
previously, somewhat higher than the 5.8% that was expected.
The rand dropped sharply after the news and at midday traded at around R11.46 to the dollar, the weakest level in six years.
READ: Rand/dollar at 6-year low on deficit news
Normally a weak rand should be good news for resources shares, but a weak rand also means a strong dollar which is bad news for commodity prices.
The share prices of some of South Africa's top commodity producers continued to trade at 52-week lows, including Sasol [JSE:SOL] which lost another 1.79% to R419.83. Since the sharp drop in the oil price, Sasol's share price lost 30.3% over the last month and is now 16.5% lower for the year.
ArcelorMittal [JSE:ACL] traded 3.16% lower at R24.84 and is now 25.2% lower over the last month.
Two of South Africa's biggest platinum producers were also on new 52-week lows on Monday morning. Impala Platinum [JSE:IMP] dropped 2.66% to a new low of R76.43, after trading at a 52-week high of R127.93 at the beginning of the year.
Anlgo American Platinum [JSE:AMS], which traded at a 52-week high of R510.00 during the platinum strike in April, was 1.70% softer on Monday morning at a new low of R344.21.
The mood was also soured by the news that China's imports dropped 6.7% last month, the biggest fall since March this year. This is another indication of the weaker state of the world second-biggest economy.
The share prices of local companies with a big interest in the Chinese economy suffered. Kumba [JSE:KIO], which exports about 60% of its production to China, traded 0.42% lower to yet another 52-week low of R245.69.
Naspers [JSE:NPN], which is exposed to the Chinese economy through its interest in the Chinese internet giant Tencent, traded 1.14% lower at R1 453.05.
