JSE weaker amid trade jitters

Image: Siphiwe Sibeko/Reuters via The Conversation

The JSE fell on Wednesday, with platinum miners faring worst, as risk appetite abated amid another sign the US-China trade war is far from over.

US President Donald Trump threatened new import tariffs on Chinese goods on Tuesday, saying the country had failed to live up to a pledge to increase purchases of US farm products.

US retail sales numbers for June also weighed on emerging markets, with the consensus-beating data slightly reducing market expectations of a 50basis-point cut by the US Federal Reserve later in July.

Asian and European markets were under pressure, with US markets retreating further from record highs this week.

The JSE all share fell 0.72% to 57,636 points and the top 40 0.76%. Banks lost 1.98% and platinums 3.69%.

Statistics SA reported retail sales grew 2.2% year-on-year in May, beating the Bloomberg consensus for a rise of 1.7%.

The figures confirmed that the economy was set to record growth in the second quarter after contracting in the first, as consumer spending accounted for about 60% of GDP, Nedbank Group Economic Unit analysts said. Naspers fell 1.47% to R3,442.72.

Impala Platinum slumped 5.83% to R70.10.

It earlier offered bondholders the ability to redeem its $250m convertible bond due in 2022, seeking to use a cash windfall from good recent platinum prices to reduce high interest payments.

Focus on Thursday is on the Reserve Bank’s interest-rate announcement, with the consensus among 22 analysts polled by Bloomberg that the bank will cut the repo rate by 25 basis points.