The JSE remained in the red in noon trade on Thursday after plunging at the opening following a sell-off on world markets overnight. The bourse was off its lows, however, helped by bargain hunting as well as strength in heavyweight resources stocks in London.
By 12.09pm, the all-share and all-share industrial indices were off 0,78% and 0,92% respectively. Resources retreated 0,5%, the gold-mining index dropped 1,97% and the platinum-mining index lost 0,91%. Financials fell 1,04% and the banks index was 0,59% in the red.
The rand was bid at 6,40 per dollar from 6,36 when the JSE closed on Wednesday, while gold was quoted at $687,80 a troy ounce from $698/oz at the JSE’s last close.
“We’ve had a bit of a rocky road here again,” a dealer said. “Brent has dropped to $67,92 a barrel, gold is below $700/oz and the rand has weakened quite sharply.
“On the back of world markets, our market took an absolute hiding this morning. A large selling programme in the closing stages yesterday [Wednesday] killed our market as well.”
He continued to say that there was no major news out and the market was being driven by commodity pries, world markets and the rand. The feeling on the JSE was pretty negative.
Nevertheless, the JSE’s initial weakness on Thursday had been overdone and some bargain hunting had taken the JSE off its lows.
Strength in resources stocks in London was also helping.
“Anglo started on a negative note, but I don’t think the FTSE is feeling as much pain as we are. There is a school of thought that Anglo is cheap relative to Billiton.”
He continued that resources stocks were benefiting in London from Wednesday’s bid by Xstrata for Canadian miner Falconbridge. The offer trumps a rival one from Inco.
On the resources index, Anglo American was up 84c at R257,90 and BHP Billiton was 20c better at R126,70.
Anglo was up over 2% in London, while Billiton was around 0,6% stronger there.
Petrochemicals group Sasol, however, slipped 1,71% or R4,20 to R242.
Harmony Gold dropped 3,26% or R3 to R89,01, Gold Fields fell 2,08% or R3,10 to R146, while AngloGold Ashanti dipped 50c to R321,50.
Impala Platinum weakened 1,23% or R15 to R1 200, while AngloPlat was off R4,15 to R596,90.
On the all-share industrial index, London-listed brewer SABMiller tumbled 2,26% or R3,01 to R129,98.
Before the opening, the company reported adjusted earnings per share of 699,2c for the year to March, up 11% from the 628,2c for the year-earlier period.
In hard currency terms, adjusted EPS came in at US109,1c from a previous US101c, representing an 8% increase.
A final dividend of US31c was recommended, bringing the total dividend for the year to US44c, an increase of 16% from the prior year’s US38c.
SABMiller cautioned, however, about rising commodity cuts as well as pricing cuts in the United States.
Mittal Steel shed 1,38% or 93c to R66,50 and pulp and paper producer Sappi shed 79c to R81,71.
Furniture retailer JD Group surrendered 3,25% or R2,75 to R81,85, while clothing retailer Edcon plunged 3,97% or R1,42 to R34,38.
While Telkom lost 1,18% or R1,56 to R130,99. MTN Group jumped 2,22% or R1,25 to R57,50.
Illovo Sugar improved 1,52% or 30c to R20 ahead of its results on Tuesday.
On the financial front, London-listed Old Mutual tumbled 2,38% or 51c to R20,94 and Liberty Group lost 2,32% or R1,89 to R79,50.
FirstRand fell 1,28% or 24c to R18,56, Nedbank weakened 1,4% or R1,80 to R126,80, Standard Bank eased 35c to R79,40 and Absa weakened 50c to R112,50.
Niche banking group Investec Plc gave up 1,36% or R4,55 to R330 and Investec Ltd lost 1,37% or R4,49 to R322,51.
Investec earlier reported a 53,3% rise in headline earnings per share to 203 pence for the year ended March from 132,4 pence a year ago. A final dividend of 627c — or 53 pence — was proposed, equating to a full-year dividend of 91 pence from 2005’s 67 pence. — I-Net Bridge