JSE all share largely unchanged at midday as gold shares reduce losses

File: The market showed little reaction to Finance Minister Malusi Gigaba's statement that he would seek to avoid a ratings downgrade by Moody’s‚ on the Treasury’s planned investment road show in the US as the JSE remained largely unchanged at midday. Photo: ENCA/Scott Smith

JOHANNESBURG - The JSE continued its morning trajectory at midday on Wednesday as gold shares reduced early morning losses‚ and industrials were slightly up in lacklustre trade.

Platinum shares rebounded on a flat platinum price of $976.11 an ounce.

Spot gold was 0.55% off at $1‚282.14 an ounce. The rand was at R13.3086 against the dollar from R13.2952.

Retailers were firmer on the positive consumer inflation data‚ which showed that the consumer price index dropped to an annual 6.1% in March from 6.3% in February.

READ: Copper and zinc likely to drag JSE down on Wednesday

Lower inflation improves the likelihood of an interest-rate cut in the second half of the year‚ thereby boosting disposable income for consumers and thus supporting retailers. However‚ the Reserve Bank is likely also to keep a close eye on the rand‚ among other factors‚ before making an interest-rate decision.

The market showed little reaction to views expressed by Finance Minister Malusi Gigaba that he would seek to avoid a ratings downgrade by Moody’s‚ on the Treasury’s planned investment road show in the US.

Moody’s has not yet made an announcement on SA’s sovereign credit‚ following the downgrades to junk status by S&P Global Ratings and Fitch earlier in April. Analysts said the effect of the downgrades may be less onerous than previously thought. “The actual difference in absolute credit risk was marginal‚” Citadel chief investment officer George Herman said.

He said that defaults by countries in the top bracket of the noninvestment grade‚ such as SA‚ were only marginally higher than those on the lowest bracket of investment grade. “Falling out of the investment grade universe was costly‚ but was also not the end of the world.”

At 12.14pm the all share was 0.27% up at 52‚813.60 points and the blue-chip top 40 added 0.30%. Platinums were up 1.85%. Food and drug retailers rose 0.94% and banks firmed 0.79%. Industrials added 0.12%. The gold index dropped 1.62%.

Anglo American lifted 0.79% to R191.30.

Sibanye shed 4.23% to R31.90.

Pick n Pay was 3.52% lower at R62.26 following the release of annual results in the morning‚ which showed aftertax profit growth of 17% to R1.2bn.

Telkom gained 0.99% to R72.11.

Mediclinic lost 0.74% to R125.06.

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