/ 20 February 2009

JSE still weak, resources weigh

A weaker local currency failed to limit losses as South African stocks fell deeper into the red by noon on Friday, with weak resource counters and European markets adding pressure.

The JSE all-share index had shed 3,87%, with resources falling 3,86% and platinum counters losing 3,96%. However, gold miners were flat, up 0,15%.

Banks were down 5,44%, financials weakened 4,57% and industrials lost 3,56%.

The rand was last bid at 10,16 to the dollar from 9,95 when the JSE closed on Thursday. Gold was quoted at $981,70/oz a troy ounce from $975,45/oz at the JSE’s last close, and platinum was at $1 084,50/oz from its previous close of $1 067/oz.

“We are falling sharply in line with weak overseas markets. Anglo is falling very heavily, but BHP is holding up,” an equities trader said.

“International investors are just selling and getting out of emerging markets. The rand has weakened as a result but is not helping the market at all today.

“We are tracking overseas markets. Dow futures are down at the moment, so it’s not looking too good,” she added.

“It’s not a good day for the market as a whole. We are likely to see things getting overdone and possibly see some buying coming back into the market to pick up the pieces,” another trader said.

Dow Jones Newswires reports that the FTSE 100 index of London’s leading shares dropped to a new low for the year Friday as confidence surrounding the UK economy weakened.

Analysts blamed a rapidly slowing economy; a recession was officially confirmed in the U.K. with the release of the fourth-quarter gross domestic product figures.

On top of this, developed economies suffered their largest contraction in output in almost half a century in the final three months of 2008, according to figures released Wednesday by the Organisation for Economic Cooperation and Development.

The FTSE 100 was last down 2,60%.

US stocks are expected to slump on Friday, said Martin Slaney at GFT Global Markets, continuing Thursday’s decline on the back of fears over the bank sector and on poor manufacturing and employment data.

He called the DJIA down 109 points and the broad S&P 500 index down 11,7 points at 767,2.

Back in Johannesburg, resources giant Anglo American fell R24,99, or 13,69%, to R157,50. It earlier reported a 28,6% fall in its full year attributable profit to $5,2-billion for the year to end December 2008 from $7,3-billion a year before.

Earnings per share fell 22,2% to $4,24 from $5,58 while underlying earnings per share dipped 1% to $4,36 from $4,40 after total group underlying earnings fell 9,1% to $5,2-billion from $5,8-billion the year before. The group posted a 7,6% fall in revenue to $32,96-billion in 2008 from $35,67-billion in 2007.

BHP Billiton was down R3,24, or 1,92%, to R165,32.

Petrochemicals group Sasol added R1,75 to R266,75.

Paper group Sappi weakened R1,99, or 7,51%, to R24,51 and Mondi lost 41 cents, or 1,67%, to R24,19.

Highveld Steel was down R2,70, or 4,38%, to R59, ArcelorMittal gave up R3,16, or 4,02%, to R75,50 and Kumba Iron Ore fell R9,16, or 5,52%, to R156,84.

Among gold miners AngloGold Ashanti was up R2,55 to R318 and Harmony edged up 28 cents to R127,58, but Gold Fields lost R1,08 to R114,82.

Platinum miner Anglo Platinum shed R11, or 2,38%, to R452, Impala Platinum weakened R6,51, or 4,57%, to R135,99 and Lonmin was down R12, or 7,40%, to R150,20.

In diversified miners African Rainbow gave up R6,10, or 5,02%, to R115,50, Exxaro was down R3,20, or 4,54%, to R67,35 and Hulamin gave up 60 cents, or 6,24%, to R9,01.

Among industrials, brewer SABMiller lost R4,65, or 2,91%, to R155,35, Barloworld gave up R2,13, or 5,94%, to R33,75 and TigerBrands was off R6, or 4,69%, to R122.

Bidvest weakened five rand, or 5,62%, to R84. The group said earlier that it anticipated headline earnings per share for the six months ended December 31 2008 to be down 9% on the previous interim period.

Earnings per share are anticipated to be up by 9%.

It said the decline in headline earnings is due to the expensing of R165-million in closure and reorganisation costs in certain operations within motor retail and the UK foodservice and Ontime Automotive businesses.

Banker Standard Bank was down R4,03, or 6,06%, to R62,47. It earlier said that it expected that normalised headline earnings for the year ended December 31 2008 would be between 5% and 10% higher than the previous corresponding period.

The group said in a voluntary trading statement on Friday that in October 2008 it provided the market with financial results for the nine months ended September 2008. Despite the fourth quarter being extremely challenging the results for the year are nevertheless expected to be broadly in line with what was anticipated at that stage.

Nedbank weakened R4,22, or 5,15%, to R77,80, Absa lost R3,60, or 3,93%, to R88 and FirstRand gave up 66 cents, or 5,24%, to R11,94.

Financial services group Old Mutual fell 65 cents, or 10%, to R5,85, Sanlam gave up 25 cents, or 1,58%, to R15,60 and Investec shed R2,38, or 6,92%, to R32.

Sugar group Illovo weakened 49 cents, or 1,94%, to R24,80.

Media group Naspers was down R4,70, or 2,84%, to R160,80.

Among retailers Woolies lost 51 cents, or 3,98%, to R12,29 and Truworths was down R1,35, or 3,96%, to R32,75.

Lewis weakened R2,27, or 5,53%, to R38,81, Foschini shed R2, or 4,41%, to R43,40 and JD Group lost R1,54, or 4,63%, to R31,75.

Liberty International was down R4,40, or 8,56%, to R47.

Construction group Aveng gave up R1,02, or 4,15%, to R23,58, Murray & Roberts lost R1, or 2,86%, to R34 and WBHO was down R7,40, or 8,22%, to R82,60.

Cement manufacturer Pretoria Portland Cement shed R1,15, or 3,53%, to R31,45.

Packaging group Nampak lost 51 cents, or 3,78%, to R12,99.

Trencor was unchanged at R18,55. It earlier reported an 18% increase in adjusted headline earnings per share to 251,9 cents from 214 cents for the year to December 2008.

It declared a final dividend of 75 cents per share, bringing the total payout to shareholders for the year to 110 cents per share — a 37,5% increase.

Trencor chairperson Neil Jowell said Textainer, in which Trencor has a 62,6% interest, reported net profit for the year, excluding net unrealised losses on interest rate swaps, of $99,8-million up 38% from 2007.

Telecommunications group MTN Group fell R4,61, or 5,26%, to R82,99 and Telkom was off R4,70, or 4,26%, at R105,75. — I-Net Bridge