MARKET WRAP: JSE falls as Naspers’s 2018 slide reaches 31%

The JSE all share closed weaker on Tuesday‚ slipping below 51‚000 points‚ as the overall market was pulled down by Naspers‚ with earlier gains by banks and financials‚ due to the firmer rand‚ fizzling out towards the close.

Sentiment was overshadowed by the latest quarterly labour force survey‚ indicating that the unemployment rate rose to 27.5% in the third quarter from 27.2% in the second.

Trading turned cautious amid indications that the trade war between the US and China could escalate in the coming months.

Naspers ended the day 3.55% lower at R2‚370‚ its weakest level since March 2017‚ and extending losses for the year to 31.3%.

Banks‚ financials and retailers ended in the red‚ while gold and platinum shares were higher‚ as the platinum price edged above $830 an ounce. Global diversified miners were‚ however‚ under pressure with Brent crude shedding 1.15% to $75.93 a barrel.

By the JSE’s close, the rand had firmed 0.8% to the dollar to R14.55‚ while the euro staged a marginal comeback against the greenback.

The Dow was up 0.6% at the JSE’s close‚ following two negative sessions‚ which dragged the index into overall negative territory for 2018. European markets drifted lower‚ with the FTSE 100 losing 0.15%‚ the CAC 40 0.54% and the DAX 30 0.51%.

The recent turbulence has come despite US companies hitting quarterly earnings expectations at the highest rate since 2011‚ Dow Jones Newswires reported. Investors are struggling to put a firm value on companies amid concerns over the effect of trade tensions‚ rising interest rates‚ the fading effects of corporate tax cuts‚ and broader questions over the duration of the second-longest bull run in US history‚ the newswires said.

BlackRock analysts said in a note that equity market performance had been weak so far this earnings season‚ with market participants more focused on earnings-growth sustainability than generally strong third-quarter reports. “We believe the uncertainty around future earnings growth has increased and will likely remain high‚ reinforcing our call for exposure to quality companies‚” BlackRock said.

The all share ended the day 1.1% lower at 50‚756.60 points and the top 40 lost 1.28%. Resources shed 1.56%‚ industrials 1.48%‚ general retailers 1% and food and drug retailers 0.48%. The gold index rose 0.39% and platinums 0.23%.

Anglo American dropped 2.33% to R301.03 and Kumba Iron Ore tumbled 5.31% to R273.

Sasol lost 1.51% to R472.77.

British American Tobacco (BAT) shed 2.57% to R644.54 and AB InBev 2.15% to R1‚083.76.

Sibanye-Stillwater rose 2.57% to R10.38.

Standard Bank shed 1.42% to R163.48 but Capitec rose 1.15% to R992.71.

Shoprite gave back 2.9% to R176.72.

Pharmaceutical company Aspen jumped 4.74% to R151.87.

By: Maarten Mittner – BusinessLIVE

Source: TMG Digital.

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