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Johannesburg - The rand continued to weaken on Thursday to above R13.50 to the dollar, but the rand hedge shares in the resources sectors of the JSE did not benefit much from this.
Commodity prices are still under pressure on world markets, particularly iron and copper as well as precious metals, and that negated the advantages of a stronger rand. Analysts said it also indicates increasing concern about the Chinese economy.
The firm dollar, which reached a two-week high against the euro and a four-week high against the yen, was the main reason for the weaker rand. However, it is also putting pressure on commodities as it makes them more expensive in other currencies.
The dollar was strong on Thursday after the Federal Reserve indicated on Wednesday that further US interest rate hikes are still on the cards.
The rand traded at R13.52/$ on Thursday, more than 1.1% weaker than on Wednesday, but despite this the resources sector was 0.16% lower at mid-morning.
The other indices also moved very little and the All-share index at mid-morning was 0.02% softer at 53 576; the Top 40 index gained only 0.04% to 46 939 points.
The Industrial index was only 0.12% higher and the Financial index lost 0.15%.
Kumba [JSE:KIO] traded 2.41% lower at R158.76 after the share lost more 11% over the previous seven days. Kumba is already more than 24% lower over the past 30 days after trading at a 52-week high of R230.32 as recently as April 5.
Assore [JSE:ASR], the other iron ore producer, fell 1.35% to R217.02 after it lost more than 16.5% over the previous 30 days.
Anglo American [JSE:AGL], Kumba’s holding company, was 1.04% lower at R177.48. As recently as February this year the stock stood above R230 a share; it has lost almost 12% over the past month.
BHP Billiton [JSE:BIL], which reached a 52-week high of R249.42 in January, lost 0.42% to trade at only R195.04 by mid-morning. The company has huge exposure to iron ore in Australia.
Platinum prices recovered somewhat on the back of the weaker rand after heavy losses the previous days, although the metal lost 2.24% to $903.42 per ounce. Impala Platinum [JSE:IMP] was 0.87% higher at R41.75 after losing 9.83% over the previous seven days. Anglo American Platinum [JSE:AMS], which lost 9.23% over the same period, gained 1.05% to R314.25.
Anheuser-Busch Inbev [JSE:ANB] was the star performer in the Industrial index, gaining 5.71% to R1593.97. The share price also rose sharply in London after better-than-expected results. AB InBev gained more than 5% over the previous seven days.
Naspers [JSE:NPN], which set several new all-time highs over the past few days, took a breather on Thursday and traded 0.61% lower at R2 550.83. Richemont [JSE:CFR] reached a new high when it gained 2.25% to R115.63.
