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JSE maintains positive momentum

Cape Town - The JSE continued its good run on Wednesday, as most sectors finished the trading session positive. Gold miners remained under pressure after the price of the precious metal dipped slightly as geopolitical tensions took a back seat. 

At the close of the market, the rand had weakened to R13.26/$ a considerable 1.14% drop in value since the close on Tuesday.  The drop can be attributed to several factors, including general emerging market weakness against a stronger dollar and the notice from JP Morgan that they would be removing South Africa from their bond index at the end of April.

Producer inflation data released on Wednesday reflected more positive numbers than expected. Annual headline producer inflation decelerated to 5.2% in March from 5.6% in February – markedly lower than the market expectations of a 5.6% rise.  A notable slowdown in prices came from the ‘food products, beverages and tobacco product’s category’ which was up by a softer 6.8% from 8.4% in February.  Producer inflation in the food category is expected to remain subdued as the effects of the drought dissipate – as a strong maize crop for 2017 is estimated.  

The drop in the rand inflated rand hedges and muted losses experienced by gold miners.  The blue-chip Top 40 gained 0.99%, followed by the broader All Share Index which climbed 0.79%.  Resources firmed 1.43%, Industrials 0.81% and Financials 0.32%. 

The biggest loser on the JSE goes to PPC [JSE:PPC], dropping 5.61% to R6.23 per share.  The stock price has regularly threatened to drop below its support price of R6.50 for several weeks, but investors propping up the price caved today amid selling pressure on the construction materials sector. 

International markets

Global markets are eagerly awaiting an announcement regarding a new tax plan from US President Donald Trump on Wednesday evening in the States.  The tax plan will supposedly slash corporate rates on businesses and see foreign profits repatriated to the United States. 

The gold price remained flat at $1263/Oz amid a rally in US Treasury yields as investors’ expectations grew that the Federal Reserve was poised to increase its benchmark rate in June.  The yield on the benchmark US 10-year T-bill traded 1.74% higher at 2.314.

Brent Crude Prices edged 0.33% higher on Wednesday to $52.10 after US Energy Information Administration data showed US crude inventories decreased by 3.6m barrels last week.  The decrease in inventories has abated concerns over a glut in supply suppressing prices. 

*This report is from the Trading Desk at EasyEquities, Fin24's latest content partner on equities and market moves.

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Rand - Dollar
18.97
-0.2%
Rand - Pound
24.06
+0.2%
Rand - Euro
20.57
+0.1%
Rand - Aus dollar
12.35
+0.6%
Rand - Yen
0.13
+0.8%
Platinum
900.98
-0.2%
Palladium
1,000.76
-0.5%
Gold
2,153.55
-0.3%
Silver
24.91
-0.5%
Brent Crude
86.89
+1.8%
Top 40
65,669
-0.9%
All Share
71,900
-0.7%
Resource 10
52,931
-0.7%
Industrial 25
99,286
-1.2%
Financial 15
16,575
-0.3%
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