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Johannesburg - Investors on the JSE did not respond at all to Finance Minister Malusi Gigaba’s promise on Monday to unveil an action plan to boost growth in the South African economy to 6% per year.
Most of the major indices were only moderately higher by mid-morning, despite stronger global markets and a weaker rand which was lower for the third consecutive trading session as the rally in emerging market currencies is fast losing steam.
Global markets started the second half of the year on a firm note in anticipation of further economic strength, but this had a limited effect on the JSE although most of the dual-listed shares on the local bourse are listed on major foreign markets.
At mid-morning the All-share index on the JSE was only 0.33% higher at 51 781 points, which meant that the index is now just more than 1 000 points or 2% higher than the 50 653 level it was on at the beginning of the year. The Top 40 index was at that stage 0.39% higher at 45 601 points.
The Industrial index, which includes most of the dual-listed shares, gained 0.35% in morning trade but the Financial index traded 0.26% softer.
The Resources index was however 1.06% higher, with the big commodity giants trading higher in line with their counterparts on global markets, as expectations of global economic growth could be positive for commodities demand. Manufacturing activity in the eurozone, as measured by IHS Market's purchasing managers' index for June, hit its highest level since April 2011.
Gigaba said on Monday Treasury will unveil an action plan on Friday detailing structural changes and timelines to boost growth to 6%. The plan will be released after the policy conference of the African National Congress wraps up.
He did not give any details and there was no reaction with the rand slightly weaker in early trade on Monday, extending losses to a third straight session after comments by central bankers in developed economies suggested a shift towards policy tightening.
Analysts said last week’s comments by global central bankers - most importantly European Central Bank president Mario Draghi - give the impression that global policy tightening will continue, even with the sharp drop-off in inflation. The dollar lifted from nine-month lows and the rand traded 0.73% weaker at R13.11 to the dollar.
BHP Billiton [JSE:BIL] was 1.78% higher at R203.22 and Glencore [JSE:GLN] gained 2.43% to R50.20. Anglo American [JSE:AGL], which gained almost 9% over the previous seven days, was 1.69% stronger at R178.48.
Naspers [JSE:NPN], the biggest share on the JSE, traded 1.18% higher at R2 575.00. The share lost 1.04% over the previous seven days and 8.71% over the previous 30 days. British American Tobacco [JSE:BTI] was 0.19% softer at R891.41 but Richemont [JSE:CFR] traded 0.22% stronger at R108.41.
MTN [JSE:MTN] was 0.80% softer at R113.91, but Sasol [JSE: SOL], which lost more than 10% of its value over the previous 30 days, gained 0.98% to R370.09.
Among the banks Barclays Africa [JSE:BGA] lost 1.12% to R142.14 and FirstRand [JSE:FSR] was 0.13% softer at R32.76.
Two insurers, Dicovery [JSE:DSY] and Old Mutual [JSE:OML], were the busiest shares on the JSE. Discovery lost 0.76% to R126.95 but Old Mutual was 0.12% stronger at R32.76.
