The JSE was weaker in noon trade on Friday with retreating commodity prices prompting continued profit-taking on resources stocks. While the bourse opened higher, appearing to find support after Thursday’s 2,2% tumble, its recovery proved short lived.
By 12.06pm, the all share index slipped 0,32%. Resources were down 0,46%, the
gold mining index slumped 2,18% and the platinum mining index surrendered
0,71%. The financial and banks indices both fell 0,53%, while the all share industrial index was flat (+0,01%).
The rand was bid at 7,38 per dollar from 7,39 when the JSE closed on Thursday, while gold was quoted at $612,08 a troy ounce from $617,65/oz at the JSE’s last close.
“We opened up a bit with Asian markets slightly better. We anticipated an uptick and probably some short covering after yesterday’s [Thursday] move,” a dealer said.
“But now much of the same is happening today as yesterday. As commodity prices pull back, the trend is likely to continue.”
He explained that due to the excessive run earlier in the week, there was definitely some profit-taking, which had accelerated on Thursday afternoon.
“The Dow future is indicating that the opening will be flat at best and I would imagine we will close the week on a down day. I think we’ve still got a couple of hundred points to go this afternoon as people fine tune their positions,” the dealer asserted.
With gold and platinum pulling back after being pushed earlier in the week, related shares were returning to realistic levels, he said.
Anglo American was bucking the trend only because it had underperformed earlier in the week.
The dealer said that on the whole, the market was looking gloomy.
“There is a bit of buying in retailers, but with two more rate hikes looming this year there is no short-term value,” he commented.
Proposed quotas on clothing imports form China were also likely to limit growth in the sector and the demand for retailers could well just be due to day traders covering short positions, he concluded.
In morning trade, Anglo shares added R1,09 to R310, but BHP Billiton weakened R1,16 to R134,50.
Petrochemicals group Sasol dipped 60 cents to R243,40.
Harmony Gold plunged 3,33% or R3,27 to R94,94, Gold Fields tumbled 2,13% or R3,20 to R147 and AngloGold Ashanti shed 1,36% or R4,50 to R326.
AngloPlat was 1,6% or R12,80 softer at R785.20.
Among industrials, London-listed brewer SABMiller weakened R1,26 to R144.
Sugar and aluminum group Tongaat Hulett tumbled 2,23% or R2,05 to R90 and gases and welding products group Afrox dropped 3,5% or R1,10 to R30,30.
Mittal Steel was 1,64% or R1,30 softer at R78.
Furniture retailer JD Group gave up 1,33% or 85 cents to R63,15. But clothing retailer Edcon picked up 1,5% or 40 cents to R27.
Woolies strengthened 2,3% or 29 cents to R12,90 and Truworths bounced 2,06% or 46 cents to R22,76.
Italtile surged 4,76% or R10 to R220.
Cellular network operator MTN Group rang up 1,23% or 70 cents to R57,50.
On the financial front, London-listed Old Mutual lost 17 cents to R22,10.
Sanlam slipped 1,09% or 17 cents to R15,44.
Banking group FirstRand fell 1,25% or 22 cents to R17,45 and Absa was 1,71% or R1,70 in the red at R97,80. Nedbank was a marginal 15 cents lower at R109,50.
Standard Bank, however, inched up 14 cents to R77,15. – I-Net Bridge