The JSE stumbled 0.64%, breaking a four-day winning streak as risks out of China persists and as signs of a gradual withdrawal of stimulus by primarily the US spooked markets.
Buffering the losses were Sasol, which surged 5.36% as the oil price spurted over $80 a barrel amid a surge in demand before paring gains to last trade at $77.97, and JSE heavyweight Naspers (+1.01%) after Alibaba Group added rival Tencent’s WeChat Pay on some of its apps. Prosus, the Naspers subsidiary through which it holds a 29% stake in Tencent, dipped 0.18%.
China’s power crunch also caused turmoil in key commodities markets. . Steel producers especially took a knock as Beijing moves to clean up its carbon footprint amid an energy crisis. Locally, producers of the steelmaking ingredient iron ore felt the heat, with Kumba Iron Ore dropping 2.91%, Exxaro 1.48%, Anglo American 2.36% and BHP 1.91%. The latter is also bracing for a backlash over its plans to reduce greenhouse gas emissions at next month’s annual shareholder meeting in London. The Financial Times reports Glass Lewis, the influential proxy adviser, has recommended clients vote against the world’s biggest miner’s Climate Transition Action Plan, citing concerns about its scope as well as the alignment of its target with the latest climate science.
Aluminium producers were also hit, with Hulamin losing 3.42% and South32 0.48%.
Meanwhile, the stronger US dollar and negative global sentiment have hit locally produced commodities hard, with palladium losing over 5% to last trade at $1,870/oz and platinum 1.16% to $972.50. Gold also lost shine, last trading 0.76% lower at $1,737.53/oz.
PGM counters Implats (-3.91%), Barplats (-4.33%) and Angloplat (-2.32%) were all weaker, with gold stocks Harmony (-2.12%), Gold Fields (-1.48%) and DRDGold (-2.29%) adding to the gloom.
On the currency front, the rand took a hit from rising US treasury yields fuelling the dollar and keeping emerging currencies under pressure. The local unit tested R15.15 against the US unit before paring losses to last trade at R15.11/$.
“The rand is looking a little vulnerable but has not broken the resistance level of R15.20, which will give us an indication that the rand wants to make a run to the R15.50-level, which is the previous high of a few months ago,” comments TreasuryONE.
Indicators as at 17:00
Currencies
USDZAR 15.1041
EURUSD 1.1673
EURZAR 17.6258
GBPUSD 1.3533
GBPZAR 20.4343
AUDZAR 10.9231
CADZAR 11.8885
CNYZAR 2.3371
ZARJPY 7.3735
CHFZAR 16.2571
USDAOA 599.25
Bonds and equities
R186 7.67%
US 10 Year 1.54%
JSE -0.82%
FTSE -0.39%
S&P 500 -1.67%
Commodities
Gold $1 733.78
Plat $969.57
Plad $1 903.06
Rhod $14 490.00
Irid $4 990.00
Ruth $673.00
Copp $9 262.85
Brent $79.02
Iron Ore 62.5% $120.23
Coal API4 $167.00
Gold ZAR R26 162.74
Plat ZAR R14 630.81
Indicators brought to you by TreasuryONE
