JSE muted as market awaited Zuma's fate

Aug 08 2017 20:12
Martin Harris, EasyEquities

Johannesburg - Activity on the JSE remained muted on Tuesday as market participants waited for the outcome of the vote of no confidence.  At markets close, MPs were still to cast their vote via secret ballot. 

On Monday, the rand strengthened 1.5% immediately on the surprise announcement that the vote will be held by secret ballot. At close on the JSE, the rand was trading at R13.22 against the greenback. The unit however tumbled against the US dollar shortly after the announcement that President Jacob Zuma survived to live yet another day in a 177:198 vote against the motion of no confidence.

The JSE All Share Index was down by 0.33%, while the blue-chip Top 40 slipped 0.38%. All sectors closed in the red barring gold miners, with Resources drawing 1.36% down, Financials 0.29%, and Industrials 0.09%.

Private equity group Brait [JSE:BAT] dropped 4.80% to R58.34 following the release of a quarterly report. Brait reported that its net asset value per share declined 5.1% to R74.14 in the three months to June, from R78.15 in March. 

Brent Crude edged 0.21% lower to $52.26 a barrel as OPEC and some non-OPEC producers have agreed since the start of the year to slash 1.8 million barrels per day in supply until March 2018. So far, the deal has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria, as well as a relentless increase in US shale output.

In other market moving news, a 2017 defense white paper from Japan has upgraded its official warning on North Korea, stating the threat has entered a "new stage" and the regime may have already acquired the ability to miniaturise nuclear weapons. Defying pressure from new UN sanctions, the hermit regime said it would "under no circumstances" negotiate on its nuclear and missile weapons programmes.

Chinese trade data produced a rare miss in July with annual growth levels undershooting expectations. Exports from the world's second-largest economy rose 7.2% from a year earlier, while imports expanded 11%, resulting in a trade surplus of nearly $47bn. China also said it will pay the biggest economic price from the new UN sanctions against Pyongyang, but will always enforce the resolutions.

* This report is from the Trading Desk at EasyEquities, Fin24's latest content partner on equities and market moves.

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