The JSE lost 118 points by midday with resources leading the pack downhill, although some support was seen coming for bank and retail counters.
By 12.07pm, the all-share index was down 0,55%, with banks the only shining light, up marginally by 0,07%. Financials were down 0,20% while resources lost 0,92%. In fact, resources were the worst hit, falling 0,92%, with gold down 2,42% and platinum 1,93% softer. Industrials were off by 0,30%, but retail stocks seemed to be finding some support.
The rand was bid at 6,84 per dollar from 6,81 at the previous close, while gold was quoted at $615,90 a troy ounce from $613,40/oz on Thursday.
“We expected the market to be slightly weaker today [Friday] after the Dow only closed up 7 points, but on aggregate over two days we’re actually still up thanks to Anglo,” said Martin Lentsoane, senior trader from Cortex Securities.
“We washed away 200 points of our gains this morning after running nicely on Anglo yesterday [Thursday], but we’re still up 200 points over the two days, so it’s still fairly good,” he added.
“The Anglo buyback hasn’t come to an end and is still creating some support, but gold stocks generally are coming under pressure at this gold price.
“I am, however, seeing support for some retailers and banks. I see a bit of a shift out of resources into banks and retailers as investors look for value,” said Lentsoane.
“There is value in gold, but I wouldn’t be buying now as it’s slightly early — if gold breaks below $600/oz there will be carnage in these stocks,” concluded Lentsoane.
London-listed Anglo American, fresh from a broker upgrade on Thursday, where it surged R6,50, fell during the morning session by R1,45 to R310, while BHP Billiton lost 75c to R133. Petrochemicals group Sasol was down 87c to R251,20.
Among gold counters, it was a case of all fall down as AngloGold Ashanti shed 2,35% to R333, Gold Fields dipped 2,92% to R131,10 and Harmony Gold lost 2,11% to R93.
Among platinum counters, AngloPlat was off 2,42% to R785,50, and Impala was down 1,68% to R1 239.
Among the banks Absa fought the down trend to rise by 1,01% to R99, FirstRand was up 13c to R17,02 and Sanlam was marginally up by 2c to R15,51.
Sanlam said in a trading update that due to the reduction in the weighted average number of shares in issue as a result of the share buyback programme, the increase in its headline earnings per share is expected to be between 33% and 38%.
Among retailers, Woolworths was 0,60% higher at R13,43, Mr Price was 0,52% up to R19,40, Truworths was up 3c to R23,85 and heavyweight Massmart led the pack, rising 1,14% to R52,20. Edcon was up by 8c to R28,88 and JD Group added on 5c to R68,30.
Famous Brands added 3,04%, or 35c, to R11,85 on news that its system-wide retail sales were up 22% and like-on-like retail sales up 16% in the four months since March 1. — I-Net Bridge