We take a look at the Johannesburg Stock Exchange (JSE) trading statistics for the week ending 27 September 2019 and compare the numbers to that of a year ago.
Trading statistics for the week ended 27 September 2019
Rand outlook weak
The week ahead will once again leave us at the mercy of the global environment, with markets keeping a keen eye on unfolding events such as the motion to impeach President Trump, calls for Boris Johnson to step down and the ongoing trade dynamic between the US and China. From a data perspective, a few important releases are set to take place locally, including new vehicle sales and the Standard Bank (JO:SBKJ) PMI, while we will keep an eye on Chinese and US manufacturing PMI, US unemployment and UK GDP numbers. The Rand has moved towards a leg weaker, with the new target level being set at R15.06/$, with a break above this signaling a new bout of weakness that could see the currency target R15.20. The rand starts the day trading at R15.05/$, R16.44/€ and R18.55/£
Number of trades:
Number of trades (2019): 1 428 815
Number of trades (2018): 1 314 151
% change year on year: 8.73%
Volume traded (2019): 1 340 704 000
Volume of traded (2018): 3 174 662 000
% change year on year: -57.77%
Value of trades:
Value of trades (2019): R78 296 806 000
Value of trades (2018): R86 427 854 000
% change year on year: -9.41%
Net sales/Purchases (2019): -R7 564 114 000
Net sales/Purchases (2018): -R232 478 000
So year to date (YTD) foreigners have been net seller/buyers:
Net sales/Purchases (2019): -R69.504 billion
Net sales/Purchases (2018): -R14.642 billion
So a year ago foreigners were net sellers of SA listed shares to the value of -R14.642 billion for the YTD while this year they have been net sellers to the tune of -R69.504 billion in the year to date (YTD). That is a R54.862 billion difference between the net buying/selling position last year compared to this year as foreigners accelerate their selling of SA's listed stocks.
A clear sign that foreign capital is still leaving South African equities in vast amounts. This while the South African government continues to try and convince investors that South Africa is open for business. But the large scale corruption, poor government service delivery, slow economic growth, restrictive labor laws, worries about property rights, crime and general public disorder in the forms of strikes and looting are keeping potential investors away from South Africa.
Market Cap (2019): R17.505 trillion
Market Cap (2018): R14.247 trillion
% change year on year: 22.87%
So as shown in the JSE total market capitalization above, the overall stock market of South Africa has increased significantly over the course of the last 12 months (and it would have been even higher if it wasn't for the tariff war between the USA and China). The markets had a particularly positive start to the year, with all four months of the year ending in positive territory. However, since then there has been a few negative months. Including September 2019 in which the JSE All Share Index ended down roughly 2%
Exchange Rate (seems to be see-sawing a lot. See our exchange rate page)
The impact of the 25 bp cut announced by the South African Reserve Bank (SARB) monetary policy committee and the impact will have on the Rand as well as the South African economy on the medium to long term
financial woes and weaker than expected tax collections is forcing the government to borrow more money, which is negatively affecting the South African exchange rate, and potential credit rating cuts coming for South Africa's government which pushes up the cost of borrowing, and this at a time when the government is borrowing more and more
Expropriation of land without compensation (EWC)
Potential expansionary monetary policy coming considering the very weak economic growth numbers
Sluggish economic growth. See our SA GDP page and high levels of unemployment
Tax increases announced in the budget speech and how it will affect South African consumers spending patterns and potentially increase inflation levels as taxes were increased by rates higher than inflation. In particular lack of bracket creep relief and higher sin taxes, fuel levies and road accident fund levies will hurt consumers.
Protests and violence in the major cities of South Africa is starting to affect investor confidence even more.
Attacks on Saudi Arabian crude oil facilities and rising tensions in the Gulf region as the US blames Iran for these attacks. Crude price shot up but since then has declined back to levels before the attacks
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