THE JSE ended the week lower as banks and financials retreated ahead of next week’s keenly anticipated budget speech.

The market was also dragged down by a sharp fall at MTN, after the telecommunications group said it expected its profit to be 20% lower.

Local banks were sold off as European banks showed renewed signs of a sell-off, with Deutsche Bank among those hit.

At 5pm, the all share was 1.84% lower at 48,940.40 points and the blue-chip top 40 lost 2.22%. Banks were 4.06% weaker and financials shed 2.63%. Industrials were down 2.08%. Resources ended the day 0.22% off. The gold index gained 7.76% and platinums firmed 1.02%.

The all share traded in mixed fashion for most of the week, but was still 0.72% up at the end of the week. The all share is 3.46% down for the year so far.

At the close, the FTSE 100 was 0.68% weaker and the CAC 40 shed 0.97%. The Dax lost 0.70%. The Dow Jones industrial average opened 0.67% lower.

Barclays Research analysts said the global risk rally, which saw the Dow Jones industrial average record three successive sessions of gains in the week, ran out of steam on Friday.

It said oil prices failed to hold onto recent gains on renewed concern of oversupply, pushing commodity-linked currencies lower. This followed a report that US crude inventories had reached an 86-year high.

At the JSE’s close the Brent crude price was 1.88% lower at $33.40 a barrel.

An analyst at Denker Capital, Kokkie Kooyman, said the outlook for global banks was troubling as markets were ruled by fear at present. Global deflationary concern meant pressure on banks’ interest margins.

"Europe has a persistent banking problem, but compared with 2008 the banking system is significantly better capitalised."

He said as banks have fallen between 25%-28% on average year-to-date, the bad news had seemingly largely been priced in. Relative to the past, banks were now attractively priced, particularly in emerging markets.

Mr Kooyman said the banking system did not present a systemic risk to world growth, with the exception of Chinese banks.

Standard Bank led the losses in the banking sector, closing 5.71% lower at R113.35. Barclays Africa dropped 3.85% to R151.38.

MTN ended the day 18.02% lower at R126, the sharpest fall in 17 years.

Among financials Old Mutual shed 3.55% to R37.50 and Sanlam was 5.11% weaker, at R54.80.

Gold Fields lifted 10.02% to R61.60, while AngloGold Ashanti was 7.47% higher at R170.05.

Among retailers Woolworths dropped 4.08% to R85 and Shoprite shed 3.59% to R145.58.

Property stock Growthpoint softened 0.84% to R24.70, while New Europe Property Investments was 3.67% lower at R171.18.

Naspers was 0.52% weaker at R1,820.