The JSE Securities Exchange South Africa (JSE) was under pressure in noon trade on Tuesday as the wrecking balls of weak world markets and a strong rand knocked the local bourse. Gold stocks managed to recover from a soft start to lead the upside of the market on the back of a higher bullion price.
At 1203, the all share index was 1,33% weaker. Resources retreated 1,99% in morning trade, while the platinum mining index plunged 4,98%. The all share
industrial and financial indices were down 0,97% and 0,53% respectively.
The banks index was flat (+0,12%), while the gold mining index was 1,18% stronger.
The rand was trading at 8,0425 to the dollar from around 8,1450 when the JSE closed on Monday, while gold was quoted at $333,50 an ounce from $330,25/oz at the JSE’s last close.
A dealer described the morning’s activity on the JSE as rather lacklustre. “The JSE has been under a lot of pressure. It was impacted by world markets being down and the rand strengthening — I think people will watch the rand with a great deal of nervousness,” he said.
He added that the oil price was “looking to spike”, which was not helping industrial shares.
“We are seeing quite a big capital destruction process going on in our market,” the dealer asserted.
London-listed diversified resources group Anglo American (AGL) led the downside of the market, due to its heavy weight. It was down 3,27% or four rand at R118,50.
BHP Billiton (BIL) was 2% or 83 cents weaker at R40,70. However, the dealer said that the weakness in platinum stocks had been a key feature of the morning.
“As the strike at Impala over funeral benefits continues illegally, it has caused pressure on the stock. We see it impacting on earnings by about 12 cents per share per day that the operations are at a standstill,” the dealer said.
Impala Platinum (IMP) took an unmerciful pummeling on the JSE and was 5,87% or R25 in the red at R240.
AngloPlat (AMS) was down 4% or R9,99 at R401, while Northam (NHM) dived 6,38% or 90 cents to R13,20. On the industrial index, Swiss-listed luxury goods group Richemont (RCH) was 1,98% or 24 cents weaker at R11,90, while on the financial index Liberty International (LBT) was down 1,22% or 90 cents.
PSG was down 40,71% or R2,06 at R3. While the share went ex-dividend on Monday, it did not trade on that day. Shareholders will receive a special dividend of one rand.
The dealer said that while there had been some follow through from the higher bullion price to gold stocks, the strong rand had capped gains. Nevertheless, Gold Fields (GFI) led the JSE’s upside, gaining 2,45% or two rand to R83,50. – I-Net-Bridge