GT247.com Trading Blog

Oil price drop induces further stock pessimism

Written by Musa Makoni | 21 Apr 2020

 

The JSE fell on Tuesday as global markets tumbled on the back of a rout in crude oil prices.

Monday saw an unprecedented event in the commodity markets as WTI crude oil futures prices for May delivery traded in the negative. This highlighted the extent of how low the demand is, as storage space has become scarce for the liquid gold. As a result, the trend was mostly pessimistic across most global markets in today’s session as investors try to gauge the impact the pandemic could still have on global growth.

On the currency market, more weakness was recorded for the rand as it breached R19/$ to reach a session low of R19.11/$. The local currency staged a minor recovery however at 17.00 CAT, it was recorded trading 0.86% lower at R18.99.

GT247, South Africa's Top Online Stockbroker, as voted by Intellidex, will continue to operate their powerful MT5 trading platform during the COVID-19 lockdown period. The trading team has assembled their workstations at home and are operational remotely. Clients may experience slight delays in support queries but trading online will resume as normal. Please use our FAQ self-help portal or email supportdesk@gt247.com if you require assistance.

 

 

Losses on the local bourse were led by the resources index as miners struggled considerably on the day. Impala Platinum [JSE:IMP] fell 13.6% to close at R97.38, Sibanye Stillwater [JSE:SSW] fell 10.03% to close at R29.50, while Anglo American Platinum [JSE:AMS] tumbled 9.18% to close at R825.00. SA Corporate Real Estate [JSE:SAC] fell 15.33% to close at R1.16, while Redefine Properties [JSE:RDF] dropped 5.45% to end the day at R2.43. BHP Group [JSE:BHP] which released a half-year operational review lost 5.35% to close at R289.09, while Kumba Iron Ore [JSE:KIO] weakened by 5.42% to close at R316.83. Significant declines were also recorded for Hyprop Investments [JSE:HYP] which lost 7.56% to close at R17.25, and Glencore [JSE:GLN] which closed at R31.33 after losing 5.58%.

 

 

 

A handful of stocks managed to record decent gains on the day. Construction firm, WBHO [JSE:WBO] surged 4.2% to close at R92.00, while holding company Brait [JSE:BAT] advanced 3.43% to close at R3.62. MTN Group [JSE:MTN] advanced 3.06% to close at R44.76, while its industry peer Vodacom [JSE:VOD] added 1.27% to close at R119.29. Gains were also recorded for Sirius Real Estate [JSE:SRE] which rose 1.92% to close at R15.90, Old Mutual [JSE:OMU] which climbed 1.52% to close at R12.04, and AngloGold Ashanti [JSE:ANG] which closed at R424.20 after gaining a modest 0.72%.

The JSE Top-40 index eventually closed 2.36% weaker while the JSE All-Share index lost 2.5%. The Resources struggled the most amongst the major indices as it lost 4.5%. The Financials and Industrials indices lost 1.58% and 1.3% respectively.

The pressure on brent crude did not subside as the commodity was recorded trading 21.51% weaker at $20.08/barrel just after the JSE close.

At 17.00 CAT, Gold was 0.82% softer at $1682.49/Oz, Platinum was down 4.37% at $740.56/Oz, and Palladium had lost 11.79% to trade at $1916.62/Oz.

Disclaimer:

Any opinions, news, research, reports, analyses, prices, or other information contained within this research is provided by GT247.com at GT247 (Pty) Ltd t/a GT247.com (“GT247.com”) as general market commentary, and does not constitute investment advice for the purposes of the Financial Advisory and Intermediary Services Act, 2002. GT247.com does not warrant the correctness, accuracy, timeliness, reliability or completeness of any information which we receive from third party data providers. You must rely solely upon your own judgment in all aspects of your trading decisions and all trades are made at your own risk. GT247.com and any of its employees will not accept any liability for any direct or indirect loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from use of or reliance on the market commentary. The content contained within is subject to change at any time without notice.