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Johannesburg - Share prices on the JSE recovered on Tuesday despite global markets struggling to find direction now that the honeymoon with US President Donald Trump’s economic policies is over.
World markets experienced the biggest drop in six weeks on Monday and Asian shares slipped even further on Tuesday, as Trump’s stringent curbs on travel to the United States brought home to investors that he is serious about carrying out his controversial campaign pledges.
Analysts said investors who focused only on his promise of tax cuts and simpler regulations have now realised that some of his policies, like protectionism, could undermine the economy as they are detrimental to economic activity.
Good news for the local market was that the rand stabilised on Monday, trading at R13.50 to the dollar after reaching R13.68, which helped the financial sector recover after it dropped sharply on the two previous days. The Financial index at mid-morning was already 1.17% higher, which also boosted market sentiment.
The local market opened lower but the All-share index was marginally higher by mid-morning, trading 0.45% up at 52 899 points. The Top 40 index was 0.49% stronger at 46 074 points. The Industrial index, which includes most of the dual-listed shares, was 0.22% firmer. The index is already 5% higher over the past month after losing more than 10% last year.
The resources sector was initially the biggest loser, trading almost 1% softer as commodity prices took a breather on perceptions that the run on expectations of strong infrastructure expenditure and economic growth has gone a little bit too long. The sector later recovered and at mid-morning was 0.24% stronger.
The prices of precious metals were however higher, with platinum gaining 2.59% to $990 per ounce and gold trading 0.65% stronger at $1 200/oz. The Platinum index gained 1.895% but the Gold index was 1.02% lower as investors took profits after Monday’s run.
Impala Platinum [JSE:IMP] traded 2.29% higher at R53.25 and Anglo American Platinum [JSE:AMS] gained 1.49% to R353.41.
Barclays Africa [JSE:BGA], which tends to be more volatile than the other major banks, was the best performer in the banking sector and firmed 1.09% to R158.20. FirstRand [JSE:FSR] was 0.44% higher at R49.79 and Standard Bank [JSE:SBK] gained 0.51% to R143.25. Nedbank [JSE:NED] traded 0.33% higer.
Among the insurers Old Mutual [JSE:OML] traded 1% stronger at R35.35 and Sanlam [JSE:SLM] gained 0.83% to R65.43.
Richemont [JSE:CFR] delivered a strong performance in the industrial sector and traded 2.05% higher at R105.65. Naspers [JSE:NPN] was however 0.78% softer at R2 140.00 and British American Tobacco [JSE:BTI] lost 0.55% to R825.01.
Steinhoff [JSE:SHF] continued its decline of late and traded 1.17% softer at R65.12. The company said in cautionary announcement on Tuesday that it remains engaged in exclusive ongoing negotiations with Shoprite [JSE:SHP] regarding the potential sale of Steinhoff’s Africa retail assets to that company. Shoprite gained 0.31% to R178.74.
The major commodity conglomerates were all marginally higher. Anglo American [JSE:AGL] gained 0.10% to R229.76 and BHP Billiton [JSE:BIL] was 0.52% stronger at R244.81. Glencore [JSE:GLN] was 0.51% firmer at R55.34.
