Home Business Resurfacing political risk pulls the JSE down

Resurfacing political risk pulls the JSE down

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The JSE was weaker in midday trade on Monday after Treasury officials confirmed that Finance Minister Pravin Gordhan and his deputy‚ Mcebisi Jonas‚ were ordered by President Jacob Zuma to return from an investor road show in the UK and US‚ saying the trip was unauthorised.

However the local market was off the morning’s worst levels.

Prior to the news‚ the rallying rand kept miners and rand hedges in check amid global uncertainty following the Trump administration’s legislative setback on Friday.

In opening trade‚ the rand rallied to R12.31 against the dollar from a close on Friday of R12.41/$.

Investec economist Annabel Bishop said the rand’s recent strengthening trend was aided by international factors but then weakened markedly on market rumours that the Treasury’s road show was interrupted when Gordhan was “purportedly instructed to return to SA”.

“The domestic currency’s sharp move today reflects fears that minister Gordhan’s tenure may be in jeopardy again.”

The Dow closed 0.29% lower at 20‚596.72 points on Friday after US President Donald Trump withdrew his healthcare bill from a vote in the US house of representatives on uncertainty that it would secure a majority vote.

Asian markets started the week weaker‚ led by the Nikkei 225 losing 1.44%. The Hang Seng was off 0.72% and the Shanghai Composite losing 0.08%.

At 12.15pm the all share was 0.71% lower at 51‚447.9 points and the blue-chip top 40 shed 0.69%.

Gold miners and platinum stocks gained 3.96% and 3.35% respectively. Banks shed 2.26% and financials 1.2%.

Diversified miners were all down‚ led by Glencore shedding 2.88% to R48.81.

Kumba iron Ore lost 5.02% to R189.90 and ArcelorMittal 3.06% to R10.76.

Rand hedge stocks were firmer with British American Tobacco up 2.41% to R829.29‚ and AB InBev gaining 1.34% to R1‚400.

Harmony gained 3.97% to R30.67‚ Sibanye Gold was up 4.6% to R28.85 and Gold Fields 3.98% to R45.98.

Impala Platinum was 5.19% firmer at R44.39 and Anglo American Platinum 3.82% to R292.95.? — TMG Digital/BusinessLIVE