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Johannesburg - As expected, the JSE was lower on Wednesday morning as many investors are seeking the sidelines in anticipation of this afternoon’s Budget Speech. The losses were however modest as the market received support from world stock markets which are on an all-time high.
Industrial shares were modestly higher, with the Industrial index gaining 0.05% in early trade, helped by stronger European markets.
The Financial index was 0.23% softer despite a slightly stronger rand, which traded at R13.09 to a somewhat weakened dollar.
The resources sector was the biggest loser, with Anglo American [JSE:AGL] losing 1.39% to $216.90.
The result was that the All-share index was 0.11% lower in early trade at 52 526 points, while the Top 40 index, which consists mainly of the big dual-listed shares, shed 0.16% to 45 484 points.
Wall Street set the tone for global markets on Tuesday when the Dow Jones index reached a new high for the eighth consecutive day on the back of solid company results, while upbeat factory statistics in Europe pushed the Dax index in Germany to the highest in two years.
Markets in Britain, France and Asia also followed the trend and the world stock index rose to an all-time peak overnight.
Among the top shares on the JSE Naspers [JSE:NPN], which represents about 20% of the bourse’s value, was already 1.41% higher at R2 225.80 shortly after the opening. Naspers, which has been quite turbulent over the past few days, took its cue from Tencent, the Chinese internet giant listed in Hong Kong. Tencent was 1.42% higher on Wednesday morning and is trading close to a 52-week high. Naspers owns 34% of Tencent.
MTN [JSE:MTN] was 1.01% higher at R120.60, but Sasol [JSE:SOL] was 0.05% softer at R383.40. Mediclinic International [JSE:MEI], which lost more than 5% on Tuesday after a disappointing trade report on its business in Abu Dhabi, lost 1.80% to trade at R112.01 and is now approaching its 52-week low of R120.
Steinhoff [JSE:SNH] and Shoprite [JSE:SHP] are still among the busiest shares on the JSE after Monday’s news that talks on a possible merger have collapsed. Steinhoff was higher for the third day but traded only marginally up, gaining 0.21% to R72.15.
Shoprite, which made the biggest gains this week, was 0.75% softer at R193.17. The company said on Tuesday it advanced trading profit by 19.2% to R3.9bn for the six months to December 31 on the back of overall sales growth of 14% to R71.3 billion. Trading margins – a key metric used by the retail sector to measure profitability – grew to 5.4% compared with the same period in 2015.
