The JSE plummeted a massive 1 132 points — more than 4% — on Friday as global credit fears submerged the local bourse in a bloodbath.
The last time the JSE lost almost 1 000 points was on February 27 this year, according to a local trader.
However, the 4,02% drop in the market was not the biggest seen by local investors. The market plunged by as much as 30% in 1987, 1998 and 2002.
On Friday, the JSE all-share index tumbled 4,02%, with resources losing 5,07%, the gold-mining index pulling back 1,46% and the platinum-mining index falling 2,77%. Financials shed 4,44% and banks were 5,46% lower, while industrials were off 2,61%.
The rand was bid at 7,16 to the US dollar from 7,01 when the JSE closed on Wednesday, while gold was quoted at $673,80 a troy ounce from $676,10/oz at the JSE’s last close.
Earlier on Friday, the JSE all share index was down 4,66%.
“This is the most the market has been down in terms of points that we have seen in a long time,” said a local trader.
He added that the general market sentiment has changed, and that a few days ago investors were thinking that the market may bounce back, but now they are closing all their long positions and are selling stocks.
He concluded that subprime issues and credit concerns were a factor in bringing the local market down, but added that foreigners were closing their positions in emerging markets as they were “trying to save what they have at home”. — I-Net Bridge