Share

JSE runs out of steam as major indices drift lower

Johannesburg - Share prices on the JSE made another promising run early on Thursday after a strong performance on Wednesday, but then lost some of the momentum by mid-morning with major shares and indices drifting slightly lower for the rest of the morning.

The rand also lost some of its momentum of the previous few days as the market waits for the Reserve Bank’s decision on interest rates later in the day.

The general consensus is that the monetary authorities are not ready to start lowering interest rates, despite lower than expected inflation, as there are still too many uncertainties on the future prospects of the South African economy.

These uncertainties also weigh heavily on JSE investors, borne out by the fact that domestic investors have been big sellers of local stocks to take their money offshore.

The local market is however still supported by buoyant global markets, which continued their advances on Thursday on expectations that the major central markets will keep interest rates lower for longer. Asian shares rose to their highest levels in nearly a decade on Thursday.

The MSCI World index inched up in its 10th straight session of gains and set a record high for the sixth consecutive day, lifted by all-time closing highs on Wall Street in the wake of strong earnings reports.

By mid-mornng the All-share index was only 0.24% higher at 54 223 points, while the Top 40 index traded 0.32% stronger at 47 903 points. The Industrial index was 0.42% up and the Financial index had added 0.46%.

Resources shares were however 0.37% lower despite a softer rand on new uncertainties about mining rights in South Africa, after Mineral Resources Minister Mosebenzi Zwane proposed a restriction on the granting and renewing of mining rights needed by producers to operate in the country.

Zwane issued a request for submissions on the proposal in a Government Gazette published on Wednesday.

At mid-morning the rand traded 0.68% weaker at R12.98 to the dollar.

Naspers [JDSE:NPN], which gained more than 3% on Wednesday, shot up to a new all-time high of R2 820.00 in early trade, but then lost momentum as the share price of Tencent also lost early momentum in Hong Kong. By mid-morning the share was still 0.71% higher than the previous day’s close at R2 798.84.

Naspers’s share price is driven by the price of Tencent, the world’s biggest internet company in which it owns a 34% stake, which is listed in Hong Kong. Tencent’s share price reached an all-time high of HK$298.80 in early trade in Homg Kong, but eventually closed 0.34% softer at HK$297.00.

Vodacom [JSE:VOD] was another share which shot to a 52-week high before losing ground again. At mid-morning Vodacom traded 0.39% softer at R174.81, but in early trade was on a new intraday high of R177.00.

The group announced on Thursday that first-quarter sales gained 3.9% as it invested in its network and increased smartphone sales. Revenue was 15% higher at R20.7bn and the  company added 2.3 million customers in South Africa and 280 000 customers in its four other markets, bringing the total to 70 million people.

MTN [JSE:MTN], which gained more than 5% over the previous seven days compared to 3.8% by Vodacom [JSE:VOD], traded 0.49% higher at R122.41.

Shoprite [JSE: SHP], which made a strong run on Thursday, fell victim to profit-taking on Thursday and lost 2.2% to R202.82. Retail shares moved strongly on Wednesday on news that South African retail sales rose by 1.7% year-on-year (y/y) in May, beating market expectations after increasing by a revised 2% in April.

Analysts polled by Reuters had forecast a 0.3% y/y fall in retail sales in May. Mr. Price [JSE:MRP] which is almost 10% higher than a week ago, added 0.46% to R170.79.

Banking shares were again among the busiest shares on the JSE and continued their steady run of the last few days. FirstRand [JSE:FSR] was 0.31% higher at R51.61. Standard Bank [JSE:SBK] gained 0.70% to R158.10 and Nedbank [JSE:NED] traded 0.20% stronger at R216.95.




We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.94
-0.2%
Rand - Pound
23.91
-0.1%
Rand - Euro
20.45
+0.1%
Rand - Aus dollar
12.35
+0.0%
Rand - Yen
0.13
-0.2%
Platinum
904.58
+0.9%
Palladium
1,012.82
+1.1%
Gold
2,219.17
+1.1%
Silver
24.82
+0.7%
Brent-ruolie
86.09
-0.2%
Top 40
68,346
+1.0%
All Share
74,536
+0.9%
Resource 10
57,251
+2.9%
Industrial 25
103,936
+0.6%
Financial 15
16,502
-0.1%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders