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JSE extends losses on foreign selling

The JSE was deep in the red in noon trade on Thursday as the sell-off that has characterized the market over the past two weeks continued. Dealers said that foreigners appeared to be offloading local stocks in a move linked to the change in emerging-market sentiment.

By 12.19pm, the all-share and all-share industrial indices slipped 0,98% and 1,36% respectively. Resources retreated 0,66% as did the platinum-mining index, while the gold-mining index gave up 1,86%. Financials fell 0,94% and the banks index lost 0,84%.

The rand was bid at 6,61 per dollar from 6,62 when the JSE closed on Wednesday, while gold was quoted at $642,35 a troy ounce from $641,90/oz at the JSE’s last close.

“We are being slaughtered,” a dealer said. “It’s got to be a reversal in sentiment here. It’s very difficult to grasp, but it’s like after once being a pop idol being abandoned by fans.”

He continued that there was no reason for the sell-off as fundamentals had not changed that much.

“One can only attribute it to a major change in sentiment towards emerging markets. I think it is being influenced by the extent of media coverage on emerging markets, with people talking about the flight to safety.”

He said that the aggressiveness of the selling suggested it was being driven by foreigners.

“After nine down days out of ten, one would have expected some support to come in. It can only be an unwinding of positions. What concerns me is the broad scale of the selling — it shows there is a general move out of our shares.”

On the resources index, London-listed Anglo American was a marginal 20c stronger at R250,70. It was up around 0,75% in the United Kingdom.

BHP Billiton, however, slipped 1.,7% or R1,35 to R124,25.

Gold Fields tumbled 2,29% or R3,05 to R130, Harmony lost 1,5% or R1,35 to R88,85 and AngloGold Ashanti shed 1,42% or R4,25 to R295,75.

Impala Platinum weakened 1,08% or R12,01 to R1 097,99, but AngloPlat climbed R3,99 to R584,99.

Industrials to decline included Swiss-listed luxury goods group Richemont, which retreated 1,69% or 50c to R29.

London-listed brewer SABMiller slid 1,83% or R2,25 to R121.

Pulp and paper producer Sappi slumped 4,13% or R3,49 to R81,01 and Mittal Steel was 2,91% or R1,90 softer at R63,30.

Services group Bidvest surrendered 2,32% or R2,35 to R99,15 and generic medicine manufacturer Aspen dropped 3,87% or R1,44 to R35,76.

Cellular network operator MTN Group was off 2% or R1,10 at R53,90.

Brand management group Barloworld, however, was 1,09% or R1,35 better at R116,40.

Retailer Mr Price rose 1,53% or 30c to R19,90 after it reported a 48% rise in diluted headline earnings per share to 154,7c for the year ended March from 104,7c a year ago. A total distribution on 81c per share —based on a cover of two times — was declared, up from 60c last year.

On the financial front, Sanlam weakened 1,68% or 26c to R15,24 , Liberty Group lost 1,26% or 99c to R77,70 and London-listed Old Mutual was 19c softer at R20,71.

Absa slid 1,96% or R2,19 to R109,75 and RMB Holdings surrendered 2,5% or 65c to R25,35.

Nedbank was down 85c at R114,15, Standard Bank eased 30c to R76 and FirstRand dipped 4c to R17,31. — I-Net Bridge

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Tiisetso Motsoeneng
Tiisetso Motsoeneng works from Johannesburg. Deputy Editor: Business Day in Johannesburg, home to Africa’s deepest capital market. Tiisetso Motsoeneng has over 285 followers on Twitter.

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