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Johannesburg - Share prices on the JSE took a breather on Wednesday morning after Tuesday’s strong run in line with European markets, where trade was also sluggish after reaching a 21-month high the previous day.
The major indices on the JSE moved modestly in early trade and the Industrial index, which set a new record on Tuesday, at mid-morning was only 0.03% higher at 82 247 points.
The Industrial index, which includes most of the big dual-listed rand hedge shares, gained more than 7% over the previous seven days and more than 16% over the previous 30 days as investors increased their holdings in companies which earn more of their income abroad.
But the rand did not do much for these dual-listed shares on Tuesday as the currency strengthened somewhat to R13.57 to the dollar.
The major shares in the industrial sector, which were setting records or were fast approaching such milestones, were modestly lower as investors took the opportunity to take profits. Heavyweights such as Naspers [JSE:NPN], Richemont [JSE:CFR] and British American Tobacco [JSE:BTI] were all initially slightly lower.
By mid-morning the All-share index was only 0.14% higher at 54 251 points, while the Top 40 index gained only 0.11% to 47 613 points. The All-share index is currently less than half a percentage point lower than the 52-week high of 54 474 points
The resources sector, which moved strongly on Tuesday in line with a recovery in resources shares in Europe, gained 0.53%, but the Financial index was only 0.07% higher.
Naspers initially lost more than 3% to trade as low as R2 608.10 but then recovered, and at mid-morning was only 20c higher than the previous all-time high set on Tuesday at R2 689.90. Naspers is now more than 38% higher over the past 90 days.
Richemont, which reached a 52-week high of R116.10 last week, was 0.22% softer at R114.55. The share is currently more than 26% up on 90 days ago.
British American Tobacco, which gained 20% over the previous three months, lost 0.82% to R928.33. At current levels the share is only about R40 lower than the 52-week high of R969.90.
Retail shares were in the spotlight. Most of the attention was on Shoprite [JSE:SHP] after the company announced that it will pay R1.8bn to former chief executive Whitey Basson to buy out some of his share options. The fact that Basson prefers to cash in these options is seen in many circles as an indication that he is not so optimistic about the group’s future prospects, although he denies that.
The share lost 0.76% to R71.84 by mid-morning and is now almost 5% lower than a week ago. Shoprite is still more than 18% higher over the previous 90 days.
Pick n Pay [JSE:PIK] lost 0.99% to R62.71 and is now more than 11% lower over the past 30 days, but Woolworths [JSE:WHL] gained 0.66% to R71.84. Steinhoff [JSE:SHF], the international retailer which is also listed in Frankfurt, lost 0.65% to R69.30.
The market did not respond much to the news that MTN [JSE:MTN] has agreed to invest R540m into Iranian fixed broadband provider Iranian Net. The investment will give it a 49% stake in the company. It is also expected that MTN will invest R3.4bn to facilitate Iranian Net meeting its roll-out targets over the next five years.
The share price at mid-morning was only 0.20% higher at R118.95.
The resources sector was a mixed bag, with Anglo American [JSE:AGL] losing 01.9% to R180.52 but BHP Billiton [JSE:BIL] trading 0.35% higher at R202.89.
