The JSE remained in the red at midday on Wednesday, but was off its earlier lows as it recouped some of its sharp losses in the morning session.
By noon, the JSE all-share index had lost 0,78%. The gold- and platinum-mining indices fell 2,22% and 1,8% respectively, while resources gave up 1,33%. Banks dipped 1,03%, while financials were off 0,58% and industrials shed 0,18%.
The rand was bid at 6,74 to the United States dollar from 6,68 when the JSE closed on Tuesday, while gold was quoted at $805,20 a troy ounce from $807,95/oz at the JSE’s last close.
“We had an interesting start as the Dow sold off over 290 points overnight, and our market opened lower following Wall Street’s losses,” said a local trader.
The US market sold off quite a bit overnight, having a spill-over effect on world markets, after the US Federal Reserve cut interest rates by an expected 25 basis points rather than a hoped for 50 basis points.
He added that market players had to consider the impact that the US market has on global markets. He said that Asian markets opened lower, and so did the United Kingdom’s FTSE 100, and that “a lot of negative sentiment came out of the US into those markets”.
By midday South African time, the UK FTSE 100 was 0,73% lower. In Asia, the Hang Seng pulled back 2,41% and the Nikkei shed 0,7%. Overnight on Wall Street, the DJIA had lost 2,14% by its close, the Nasdaq fell 2,45% and the S&P500 dropped 2,53%.
“Interest rates are playing a big role. We hiked locally with a hint that the moves on interest rates would continue into next year to combat inflation,” he said.
The trader explained that lowering interest rates would start bolstering inflation.
“Everything is weighing on the JSE, but Dow futures are telling us that potentially there could be a firmer Wall Street open,” he said, which could add some relief to our local market.
“But right now, the JSE has no impetus to do anything,” he concluded.
Among resource stocks at midday on the JSE, Melbourne-based BHP Billiton declined R4,05, or 1,77%, to R224,75, while resource giant Anglo American gave up R3,81 to R456,09. Petrochemical group Sasol was down R1 to R343.
Arcelor Mittal improved 73 cents to R151,73.
In the gold-mining sector, AngloGold Ashanti dipped R7,33, or 2,38%, to R300,15 and Goldfields gave up R2,42, or 2,25%, to R105.
Platinum miner Anglo Platinum pulled back R15, or 1,5%, to R983 and Impala Platinum was off R5,41, or 2,17%, to R243,59.
Brewer SABMiller was R1,56 lower at R183,64.
Among banks and financial stocks, Investec shed nine cents to R70,11, and banking group Absa fell R1,89, or 1,61%, to R115,81.
Fixed-line operator Telkom was R1 weaker at R151,50, and cellphone operator MTN Group was also down R1 at R133. — I-Net Bridge