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Johannesburg - Resources shares pulled the JSE lower on Monday, on news that China's import growth slowed faster than expected in April and inbound shipments of commodities such as iron ore and copper weakened.
China's imports of crude oil, iron ore and copper all fell by volume compared with March, with the data in line with a recent survey of purchasing managers in the manufacturing sector showing April expansion was the slowest in six months.
That put further pressure on commodity prices, which are already the lowest in months, and all major commodity groups listed on the JSE traded lower by mid-morning.
At that stage the Resources index was already 1.36% lower, with the All-share index trading only 0.04% higher at 53 599 points. The Top 40 index, which includes all the big capitalisation shares, was 0.11% softer at 46 958 points.
The Industrial index was unchanged at mid-morning as heavyweights such as Naspers [JSE:NPN] and Richemont [JSE:CFR] took a breather after their recent record-breaking runs. The Financial index traded 0.83% higher on the back of a stronger rand, which firmed to R13.48 to the dollar.
Most of the attention was however focused on the latest Chinese trade data. Although the data shows trade remained robust at the beginning of the second quarter, analysts say the spurt in China's economic growth seen in the first three months of the year may be as good as it gets as policymakers seek to tighten speculative investment, especially in the property sector.
Import growth in particular will continue to face headwinds, as policy tightening will weigh further on domestic demand in coming quarters.
The result is falling commodity prices, with iron ore and steel hitting multi-month lows on China's future markets in April amid concern over rising inventories.
Most of the major international commodity groups listed on the JSE traded lower. BHP Billiton [JSE:BIL] at mid-morning was 1.2% softer at R196.35 and Anglo American [JSE:AGL] lost 1.13% to R177.35. Glencore [JSE:GLN] was steadier, losing only 0.22% to R49.94, while South32 [JSE:S32] was 0.15% stronger at R27.26.
Kumba [JS:KIO], South Africa’s biggest iron producer which lost more than 30% of its value over the previous 30 days, recovered somewhat on bargain-hunting and was 0.63% stronger at R148.85. The share reached an intraday high of R152.45 in earlier trading.
Iron producer Assore [JSE:ASR], which lost only 15% over the previous 30 days, was 1.02% softer at R207.85. African Rainbow Minerals [JSE:ARI], Assore’s holding company which lost 18% over the previous 30 days, gained 2.18% to R82.00.
Platinum shares were a mixed bag despite a stronger platinum price, which gained 2.04% to $915.30. Anglo American Platinum [JSE:AMS] lost 1.02% to R310.66 and Impala Platinum [JSE:IMP] was 1 cent higher at R41.41.
Sasol [JSE:SOL] lost 1.01% to R403.64, but the share has so far been remarkably resilient in response to the lower oil price, which is again below $50 a barrel. The stock is still 12.66% higher over the previous 30 days.
Naspers, which set a new all-time high of R2 603.91 on Friday, retreated somewhat and was 1.02% softer at R2 577.25. Richemont [JSE:CFR] was 0.95% lower at R115.00 after closing at a new 52-week high of R116.10 on Friday.
Standard Bank [JSE:SBK] lost 0.02% to trade at R146 in the financial sector, but FirstRand [JSE:FSE] was 1.41% higher at R489.38. Old Mutual [JSE:OML] gained 1.44% to R33.72.
