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JSE in limbo as world holds breath over Obamacare bill

Mar 23 2017 13:47
David van Rooyen

(Gianluigi Guercia, AFP)

Company Data

Steinhoff International Holdings NV [JSE:SNH]

Last traded 1
Change 0
% Change 7
Cumulative volume 3872495
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

MTN GROUP LIMITED [JSE:MTN]

Last traded 54
Change 0
% Change 0
Cumulative volume 10460261
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

CAPITEC BANK HOLDINGS LIMITED [JSE:CPI]

Last traded 872
Change 26
% Change 3
Cumulative volume 393603
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - Global financial markets, including the JSE, went into limbo on Thursday morning as investors are waiting to see if President Donald Trump can gather enough support in Congress later in the day to pass a bill to roll back Obamacare, one of his key campaign promises.

Trump's healthcare plan faces resistance from some conservative Republicans who view it as too similar to Obamacare, and from moderates concerned it will hurt some voters.

If Trump struggles to pass the healthcare legislation, investors will question how soon he will be able to implement his pro-growth promises, which have already been discounted by the financial markets.

Global markets dropped sharply on Wednesday in response to these uncertainties, but the losses were moderate on Thursday. On the JSE the major indices also moved very little and the volumes were very low, indicating investors' wait-and-see attitude.  

The All-share index on the JSE at mid-morning was only 0.04% higher at 52 119 points, while the Top 40 index traded only 0.09% stronger at 44 896 points.       

The Financial index was at that stage only 0.18% higher, and the Industrial index was unchanged. The Resources index was also marginally higher, gaining only 0.05%, but the Gold index shed 0.88% after Wednesday’s strong gains.

Although the dollar, which reached an eight-week low against the yen on Wednesday, recovered marginally, the rand continued to strengthen against the US currency, which put a cap on the dual-listed shares on the JSE.

The local unit traded at only R12.59 to the dollar and dipped to R12.57, the lowest since July 2015. Commentators are baffled by the strength of the rand which also firmed against other major currencies.

Naspers [JSE:NPN], which gained 2.43% over the past seven days in anticipation of Tencent’s fourth-quarter results, was unchanged at midday at R2 224.00. Naspers owns 34% of the internet giant which represents by far the biggest percentage of its value and income.

Tencent ‘s share price jumped to an all-time high earlier in the week in anticipation of the results, but has since lost ground and on Thursday was almost 1% lower. The Chinese group’s results saw a big surge in revenue for the fourth quarter but missed profit estimates as its investment in video and other content ate into the bottom line.

The prices of other major groups on the JSE also moved very little and Sasol [JSE:SOL] was only 0.21% lower at R361.01. Steinhoff [JSE:SHF] lost 0.58% to R63.13 and MTN [JSE:MTN] was 0.15% higher at R123.16.

Among the banking shares, Capitec [JSE:CPI] traded 0.50% higher at R804.04 and Investec [JSE:INP] was 0.70% stronger at R93.27. FirstRand [JSE:FSR] was 0.09% higher at R53.11 but Barclays Africa [JSE:BGA) lost 0.60% to R165.55.

The big commodity giants, which dropped more than 5% on Wednesdsay, traded marginally higher on Thursday. BHP Billiton [JSE:BIL] was only 0.11% higher at R198.17 but Anglo American [JSE:AGL] gained 0.78% to R198.91. Glecore [JSE:GLN] lifted 0.79% to trade at R52.24.


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