A red tide was sweeping the JSE Securities Exchange South Africa (JSE) in noon trade on Wednesday, stemmed only by a softer rand. A lower bullion price, a dismal performance by their ADRs in New York overnight and bad news out of AngloGold conspired to make the gold sector the worst performer in a weak market.
By 11.59am, the all-share index was down 0,88%. Resources retreated 1,86% and the gold mining index dived 3,61%, but the platinum mining index climbed 0,68%. The all share industrial and banks indices were 0,31% and 0,45% softer respectively, while financials were flat (-0,04%).
The rand was quoted at R6,63 a dollar from R6,50 when the JSE closed on Tuesday, while gold was quoted at $393,80 an ounce from $398,70/oz at the JSE’s last close.
A dealer said the JSE was primarily following world markets.
“The gold market has taken the biggest knock, with the gold price having dropped overnight and the negative trading statement out of AngloGold. Gold ADRs took a hammering in the [United] States last night, which isn’t helping,” he added.
He said that were it not for the softer currency, which was stemming losses, gold and other rand hedge stocks would be even weaker.
In morning trade, AngloGold plummeted 4,78% or R11 to R219, making it the all-share index’s worst performer. Harmony plunged 4,17% or R3,50 to R80,50 and Gold Fields gave up 2,99% or R2,31 to R75.
AngloGold on Wednesday warned that its adjusted headline earnings for the three-month period ended March 31 2004 would be materially below adjusted headline earnings for the three-month period ended December 31 2003.
In terms of the JSE’s listings requirements, “material” is defined as an earnings movement of between 10% and 30%.
Harmony was down 7,58% in the US overnight, while Gold Fields and AngloGold weakened 5,57% and 6,52% respectively.
London-listed diversified resources group Anglo American slid 2,61% or R3,95 to R147,50 and BHP Billiton was 1,99% or R1,15 weaker at R56,50.
Impala Platinum, however, climbed three rand to R516 and AngloPlat added R2,50 to R260.
Synthetic fuels group Sasol strengthened 55 cents to R102,55.
On the industrial index, furniture retailer JD Group dropped 4,22% or R1,90 to R43,10 after news late on Tuesday that a 16,7% stake in the company held by Daun & Cie would be sold in the market on Wednesday via a private placement.
Steel producer Iscor slipped 1,54% or 60 cents to R38,30 and London-listed IT group Dimension Data tumbled 2,71% or 12 cents to R4,30.
Retailer Pick ‘n Pay plunged 3,19% or 59 cents to R17,90 and Shoprite shed 2,3% or 23 cents to R9,77.
Swiss-listed luxury goods group Richemont eased five cents to R17,85.
However, London-listed beverages group SABMiller ticked up 34 cents to R74,70 and services group Bidvest was 34 cents better at R53,80.
Cellular network operator MTN Group climbed 15 cents to R32,55.
Financials to fall included Standard Bank, which was 27 cents in the red at R42,85, and FirstRand, which lost 10 cents to R10,05.
Sanlam, South Africa’s second-largest financial services group, was down seven cents at R9,48.
London-listed Old Mutual climbed six cents to R12 and banking group Absa advanced 20 cents to R48,30.
Real estate company Liberty International plc leaped 1,04% or 92 cents to R89,20 and holding company Remgro gained 44 cents to R74,45. — I-Net Bridge