Publications
Partners
The week that was
The JSE followed the same pattern last week that has become familiar to market watchers by now: starting the week strong with large price rises in index stocks sending the market to a new record high by midweek, and a weaker close by Friday.
Main indices reached new records yet again on Wednesday - we lost count of the number of new records during the last 12 months.
By Friday the market slumped decisively, with the JSE Top-40 falling nearly 1.3%, mostly as a result of lower US markets on Thursday. The Dow Jones decreased nearly 1% and the broader S&P fell 1.3%, ironically on the good news that unemployment in the US is decreasing.
This seemed to have spooked investors with renewed concern that the US government might start to rethink its policy of repurchising bonds to stimulate their economy.
US bond yields increased as a result and the dollar strengthened, which helped to push commodity stocks and international shares on the JSE higher. But even the weaker rand did not help the market on Thursday and Friday.
The local market also had to deal with the news of weaker manufacturing figures. Statistics Sa announced this week that manufacturing output in SA fell by a much larger than expected 3.3% year-on-year in September.
A decline was expected due to continued labour unrest, but the large drop still surprised.
The SA Chamber of Business also said that its business confidence index declined slighty, once again due to the labour situation which is expected to worsen as political rhetoric might impact on worker sentiment in the run-up to next year's general election.
The week ahead
Of interest this week will be the announcement of retail sales figures for September by Stats SA. To date, retail sales have remained quite robust considering al the doom and gloom in SA about the economic environment. The figures are expected on Wednesday.
Sugar producers Illovo [JSE:ILV] and Tongaat [JSE:TON] will anounce interim results this week, as well as Lewis [JSE:LEW], Vodacom [JSE:VOD], Raubex [JSE:RBX] and Mr Price [JSE:MPC].
Astral Foods [JSE:ARL], Lonmin [JSE:LON] and Abil [JSE:ABL] will publish their annual results. Abil has alrerady warned investors that results will be bad due to higher provisions for doubtful debt.
The overall direction of the market remains anyone's guess. Shares seem high and the decline on Thursday and Friday might continue this week. A new record high is just as likely.
- Fin24
*After chasing money on the JSE for 15 years, Adriaan Kruger is now living a relaxed lifestyle in Wilderness and lectures economics part-time at Nelson Mandela Metropolitan University. Views expressed are his own.
The JSE followed the same pattern last week that has become familiar to market watchers by now: starting the week strong with large price rises in index stocks sending the market to a new record high by midweek, and a weaker close by Friday.
Main indices reached new records yet again on Wednesday - we lost count of the number of new records during the last 12 months.
By Friday the market slumped decisively, with the JSE Top-40 falling nearly 1.3%, mostly as a result of lower US markets on Thursday. The Dow Jones decreased nearly 1% and the broader S&P fell 1.3%, ironically on the good news that unemployment in the US is decreasing.
This seemed to have spooked investors with renewed concern that the US government might start to rethink its policy of repurchising bonds to stimulate their economy.
US bond yields increased as a result and the dollar strengthened, which helped to push commodity stocks and international shares on the JSE higher. But even the weaker rand did not help the market on Thursday and Friday.
The local market also had to deal with the news of weaker manufacturing figures. Statistics Sa announced this week that manufacturing output in SA fell by a much larger than expected 3.3% year-on-year in September.
A decline was expected due to continued labour unrest, but the large drop still surprised.
The SA Chamber of Business also said that its business confidence index declined slighty, once again due to the labour situation which is expected to worsen as political rhetoric might impact on worker sentiment in the run-up to next year's general election.
The week ahead
Of interest this week will be the announcement of retail sales figures for September by Stats SA. To date, retail sales have remained quite robust considering al the doom and gloom in SA about the economic environment. The figures are expected on Wednesday.
Sugar producers Illovo [JSE:ILV] and Tongaat [JSE:TON] will anounce interim results this week, as well as Lewis [JSE:LEW], Vodacom [JSE:VOD], Raubex [JSE:RBX] and Mr Price [JSE:MPC].
Astral Foods [JSE:ARL], Lonmin [JSE:LON] and Abil [JSE:ABL] will publish their annual results. Abil has alrerady warned investors that results will be bad due to higher provisions for doubtful debt.
The overall direction of the market remains anyone's guess. Shares seem high and the decline on Thursday and Friday might continue this week. A new record high is just as likely.
- Fin24
*After chasing money on the JSE for 15 years, Adriaan Kruger is now living a relaxed lifestyle in Wilderness and lectures economics part-time at Nelson Mandela Metropolitan University. Views expressed are his own.
