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Financials pull the JSE lower

Oct 24 2019 19:20
*Musa Makoni

The local bourse erased earlier gains to close softer on Thursday led by losses on the financials index. Local stocks seemed to take a leaf from the firmer close in Asian markets where the Japanese Nikkei closed 0.55% firmer while the Hang Seng gained 0.87%.

The Shanghai Composite Index closed flat as it shed 0.01%. Stocks in Europe traded mostly firmer on the day as the ECB left the main refinancing rate unchanged at 0.00%.

In the USA, stocks retreated following the release of a couple of disappointing earnings.The rand held steady against the greenback as it managed to peak at a session high of R14.58/$.

At 17.00 CAT, the rand was trading flat at R14.63/$.On the JSE, miners were mainly responsible for the earlier surge as stocks such as Pan African Resources [JSE:PAN] closed 6.8% higher at R2.20, African Rainbow Minerals [JSE:ARI] surged 6.51% to close at R150.73, and Kumba Iron Ore [JSE:KIO] gained 5.46% to close at R363.99.

Gold miners also advanced on the day as gains were recorded for Harmony Gold [JSE:HAR] which rose 6.21% to close at R48.76, and Gold Fields [JSE:GFI] which added 2.37% to close at R85.48.

Listed property stock, Fortress REIT [JSE:FFB] posted gains of 2.17% as it close at R21.59, while Redefine Properties [JSE:RDF] gained 1.9% to close at R8.04.

Gains on the day

Gains on the day were also recorded for Imperial Logistics [JSE:IPL] which advanced 2.18% to close at R55.43, while British American Tobacco [JSE:BTI] closed at R515.31 after adding 0.71%. Stadio Holdings [JSE:SDO] came under significant pressure as it closed 5.68% lower to close among the day’s biggest losers.

Blue Label Telecoms [JSE:BLU] also struggled as it closed 5.3% lower at R2.68, while Grindrod [JSE:GND] fell 3.29% to close at R4.99. Healthcare provider Netcare [JSE:NTC] dropped 3.33% to close at R17.71, while Mediclinic [JSE:MEI] lost 1.51% to close at R69.95.

Despite reporting improved earnings in its half-year results, Allied Electronics [JSE:AEL] dropped 2.97% to close at R26.45. Weakness was recorded across most of the financials index constituents.

The JSE Top-40 index closed 0.24% weaker while the JSE All-Share index was unchanged.

The Financials index lost 1.01%, while the Industrials and Resources indices only advanced 0.02% and 0.08% respectively.Brent crude continued to advance on the day, and it was eventually recorded trading 0.36% firmer at $61.39/barrel just after the JSE close.

At 17.00 CAT, Platinum was up 0.97% at $925.35/Oz, Gold was 0.71% firmer at $1502.62/Oz, and Palladium had surged 1.03% to trade at $1762.95/Oz.

*Musa Makoni is a trading specialist at Purple Group.



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