JSE weaker as traders await Yellen testimony

The JSE was softer on Monday morning due to risk-off trade ahead of Federal Reserve chairwoman Janet Yellen’s semiannual congressional testimony on Wednesday.

Investors will be on the lookout for clues on the outlook for US interest rates.

Most Asian markets were closed for the Lunar New Year‚ while the Japanese Nikkei 225 gained 1.1%.

The risk-off sentiment is the result of the release of mixed US nonfarm payroll data on Friday. Payrolls increased a seasonally adjusted 151‚000 in January compared with the 185‚000 economists surveyed by The Wall Street Journal had expected. The unemployment rate fell slightly to 4.9% against an expectation that it would hold steady at 5% Dow Jones Newswires reported.

Average hourly earnings climbed 0.5%‚ more than expected.

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Barclays Research analysts described the data as confusing‚ but still expected two US rate hikes in 2016.

At 10am‚ the all share was down 0.19% at 49‚658.60 points and the blue-chip top 40 index fell 0.35%.

Gold miners led the upside on safe-haven demand‚ adding 5.68%‚ followed by platinums‚ up 4.73%. Resources gained 2.02%‚ while banks were down 1.69% after recent solid gains.

Barclays Research analysts said the US monthly employment report for January showed a downturn in the pace of hiring at the beginning of 2016‚ led by the service-providing sector of the US economy.

Alongside the recent softness in other macroeconomic data releases‚ financial turmoil and the risk from slower growth abroad‚ Barclays expected the report to keep the Fed on hold at its March Federal open market committee meeting.

Among individual shares on the JSE‚ Anglo American gained 3.31% to R82.48 and rival BHP Billiton was up 2.34% at R166.

ArcelorMittal gained 4.46% to R8.18. The steel giant on Friday announced plans to raise $3bn through an equity issue plus another $1bn from the sale of its 35% stake in Spain’s automotive steel component firm Gestamp.

Sasol was flat at R415.61 despite a firmer Brent crude price — up 0.26% to $34.19 a barrel in morning trade.

Gold miner AngloGold Ashanti surged 7.88% to R167.32 and Gold Fields gained 5.31% to R65.29.

Anglo American Platinum surged 8.26% to R292 after reporting on Monday that headline earnings for the year to December 31 2015 fell to R107m from R786m in the year-earlier period.

Platinum player Impala was up 6.02% at R39.60.

- TMG Digital/BDlive