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Trump's new tariff threat spooks JSE, other emerging markets

Sep 10 2018 18:38
Musa Makoni,

The JSE closed weaker on Monday as the trade war-induced bearish sentiment persisted across emerging markets.

Donald Trump threatened to impose additional tariffs on all Chinese imports last Friday and this has worsened the bearish sentiment currently prevailing as a result of the trade war. Asian markets got off to a weaker start on Monday with the Hang Seng pulling back 1.33%, while the Shanghai Composite Index lost 1.45%. The Japanese Nikkei shrugged off the trade war concerns after its GDP numbers improved for the last quarter and narrowing its current account deficit.

On the JSE, blue-chips struggled as they tracked mostly lower, dragging the All-Share index with them. Netcare [JSE:NTC] retreated to R27.66 after the stock shed 3.19%, while industry peer, Life Healthcare [JSE:LHC] lost 1.84% to R25.65. Ascendis Health [JSE:ASC] traded under considerable pressure, dropping 10.59% to close at R10.55 per share.

Retailer The Foschini Group [JSE:TFG] lost 3.47% despite the rand firming against the US dollar to close at R164.55 per share. Spur Corporation [JSE:SUR] weakened sharply to end the day down 7.35% at R26.27 per share, while Famous Brands [JSE:FBR] shed 5% to close at R95.00.  Rhodes Food Group [JSE:RFG] closed at R18.70 after dropping 5.08%.

Platinum miner Impala Platinum [JSE:IMP] was also among the biggest losers, giving up 6.68% to close at R17.75 per share.

Gains were limited for the blue-chip stocks, with a limited number of counters managing to trade in the green. Rand hedges surprisingly traded firmer with Mondi [JSE:MNP] inching up 0.86% to close at R411.00, while Richemont’s [JSE:CFR] 0.68% rise to R129.40 was further boosted by its five months sales update. British American Tobacco [JSE:BTI] ticked up to R720.19 after only adding 0.06%, while Sappi [JSE:SAP] rose 0.87% to R97.67.

Among the biggest winners were ArcelorMittal [JSE:ACL], gaining 8.33% to R3.51 and Lonmin [JSE:LON], adding 5.47% to R8.49. African Oxygen [JSE:AFX] was buoyed by the release of its half-year results which indicated healthy increases in earnings and revenue. The stock climbed 1.74% to close at R29.30 per share.

The JSE All-Share index closed the day 0.57% weaker, while the blue-chip JSE Top-40 index lost 0.57%. The Resources index managed to gain 0.11% however, the Financials and Industrials indices fell by 0.98% and 0.79% respectively.

The rand gained against the US dollar to peak at a session high of R15.11/$. This was mainly as a result of the US dollar weakening against a basket of major currencies. At 17:00, the rand was trading at R15.18 against the US dollar.

Brent crude traded mostly higher on the day which saw it trading 0.77% firmer at $77.42/barrel just after the JSE close.

Gold was flat at $1 197.17/oz, platinum was up 1.68% to fetch $795.38/oz and palladium was trading 0.96% firmer at $989.70/oz.

Bitcoin was 1.12% weaker at $6 308.20/coin and Ethereum had lost 3.51% to trade at $195.82/coin.

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equities  |  jse  |  markets


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