The JSE was awash with red just after noon on Tuesday, dragged down by selling from offshore. With many local players absent due to the public holiday on Wednesday, thin volumes exacerbated the market’s weakness.
By 12.14pm, the all share index slipped 1,14%. Resources retreated 1,95%, with the gold and platinum mining indices losing 1,94% and 0,9% respectively.
Industrials eased 0,28%, financials fell 1,14% and the banks index was down 1,88%.
The rand was bid at 6,16 per dollar from 6,19 when the JSE closed on Monday, while gold was quoted at $555,20 a troy ounce from $553,20/oz at the JSE’s last close.
“The market has been very quiet ahead of the holiday tomorrow. Yesterday’s volumes were deadly. A lot of guys took off yesterday and today and they’ve taken off Thursday and Friday as well,” a dealer said.
March 1 was declared a holiday due to the local government elections.
“I’ve seen some selling coming into the market out of London. There are no real bids because it is so quiet so there is nothing to support them,” he continued.
He said that gold shares were down in New York overnight and weakness was filtering through to the JSE.
Softer-than-expected GDP data released at 11.30am also contributed to the negative sentiment.
South Africa’s real GDP at market prices on a quarter-on-quarter (q/q) seasonally annualised and adjusted (saa) basis rose by 3,3% in the fourth quarter of 2005 from 4,2% in the third quarter, Statistics South Africa (Stats SA) said.
This brought the annual average real growth for 2005 to 4,9% compared with 4,5% in 2004.
The median forecast for the fourth quarter was 4% q/q saa with a range of 3,5% to 5%. The median forecast for 2005 was 5%, which is the government’s forecast given in the Budget on Febraury 15. The forecast range was from 4,8% to 5,2%.
On the JSE’s resources index, London-listed Anglo American lost 1,92% or R4,50 to R229,50 and BHP Billiton tumbled 2,8% or R2,95 to R102,55.
Petrochemicals group Sasol slipped 1,51% or R3,30 to R215,45.
Harmony Gold dropped 3,23% or R2,98 to R89,32, Gold Fields fell 1,97% or R2,79 to R138,70 and AngloGold Ashanti shed three rand to R329.
AngloPlat weakened 1,48% or R7,50 to R498 and Impala was down five rand at R1 060.
Telkom led industrials lower, slumping 2,69% or R4,60 to R166,40.
Media group Naspers slipped 1,19% or R1,50 to R124,50.
Transport and logistics group Imperial surrendered 1,2% or R1,92 to R157,70 and generic medicine manufacturer Aspen dropped 2,14% or 90 cents to R41,10.
Swiss-listed luxury goods group Richemont, however, rose 1,22% or 33 cents to R27,33, buoyed by good results from British American Tobacco (BAT) in which it holds a stake.
According to AFX, BAT, the world’s second largest cigarette maker, reported a better-than-expected 17% rise in annual earnings, driven by strong growth in sales of its core brands, cost cuts and an ongoing share buyback programme.
The owner of Lucky Strike and Dunhill reported 2005 adjusted diluted earnings per share of 89,34 pence, against 76,6 pence last time. Analysts were expecting around 87,4 pence.
Underlying operating profit, after one time items and excluding changes to the group’s structure last year climbed 9% to £2,61-billion.
The group also hiked its total dividend for the year by a higher-than-expected 12%, to 47 pence.
Construction shares had another strong day, with Aveng adding 1,04% or 25 cents to R24,30. Murray & Roberts climbed 19 cents to R23,30.
Financials to fall included London-listed Old Mutual, which was 1,1% or 23 cents softer at R20,72. Sanlam weakened 2,22% or 37 cents to R16,30.
Despite releasing good results before the opening, FirstRand slid 2,32% or 46 cents to R19,35 and its major shareholder RMB Holdings gave up 2,17% or 65 cents to R29,35.
Standard Bank was 2,16% or R1,79 in the red at R81,20.
FirstRand reported a 19% increase in diluted headline earnings per share to 74,8 cents for the six months ended December from 62,9 cents at the interim stage in the prior year.
The group declared a dividend of 32 cents per share, which was a 20% increase on the previous dividend. – I-Net Bridge