The JSE was in negative territory in noon trade on Friday, as concerns about the economy saw the sell off in banks and local-economy-centred industrials seen in recent days gain momentum. Only a handful of rand hedge stocks managed to keep their heads above water, helped by the sharply weaker currency.
By 12.10pm, the all share and all share industrial indices slipped 0,86% and 1,75% respectively. Financials fell 2,76% and the banks index dropped 4,22%. Resources rose 0,82%, but the gold mining index eased 0,09% and the platinum mining index slumped 3,67%.
The rand was bid at 7,46 per dollar from 7,31 when the JSE closed on Thursday, having traded above 7,52 for the first time in two-and-a-half years a few minutes earlier. Gold was quoted at $579,75 a troy ounce from $585,75/oz at the JSE’s last close. At $1 170,50/oz, platinum was $6,50 weaker than its level at the bourse’s previous close and $17,50 weaker than Thursday’s high.
“The marker is all over the place,” a dealer said, noting that the all share index was down over 2% from its intraday high.
“We are still seeing a massive sell off in local equities. Prices are going to challenge the lows we saw ten days ago. Industrials prices have hit levels that are quite scary. The [all share] index has been up since then purely on the back of rand hedges and resources.
“Shares like Edcon, Pick ‘n Pay, MTN and Imperial are threatening to go below where they were in late 2005. Worst hit of all are the banks.”
The dealer explained that there were fears that the rand’s slide would lead to a slowdown in consumer spending and the economy as a whole.
“The market is beginning to paint a bleak picture. The sheer speed at which we — and I included the rand in this — have retraced gives an idea of the concerns about the outlook for the economy,” he concluded.
Leading the JSE’s downside, cellular network operator MTN Group plunged 6,25% or R3,50 to R52.50. Telkom slid 3,77% or R5 to R127,50, while media group Naspers shed 4,3% or R5,11 to R113,70.
Transport and logistics group Imperial dived 5,8% or R8 to R130.
Retailer Edcon retreated 4,21% or R1,26 to R28,65. Foschini fell 4,5% or R2,05 to R43,55 and Mr Price dropped 5,82% or R1,10 to R17,80.
Among financials, Sanlam was 4,46% or 66 cents softer at R14,15. Liberty Group gave up 4,12% or R3,01 to R69,99 and health and life insurer Discovery lost 4,88% or R1 to R19,50.
Standard Bank slumped 4,27% or R3,25 to R72,80, FirstRand fell 4,95% or 86 cents to R16,50, Absa was off 4,4% or R4,40 to R95,60 and Nedbank 1,35% or R1,49 in the red at R108,50.
Impala Platinum slid 4,65% or R55,60 to R1 140 and AngloPlat weakened 2,48% or R16,90 to R665. Lonmin, however, leaped 3,99% or R14,09 to R367,09.
London-listed diversified resources group Anglo American added 2,16% or R6,01 to R284,70 and BHP Billiton was 1,97% or R2,61 better at R134,88.
Swiss-listed luxury goods group Richemont rallied 1,34% or 42 cents to R31,85.
London-listed financial services group Old Mutual firmed 10 cents to R21,81, while real estate company Liberty International was up 1,1% or R1,52 to R140,32. It earlier traded at a record high of R143. – I-Net Bridge