JSE dips further into the red

The JSE was lower at midday on Tuesday, playing catch-up after the public holiday on Monday when there was weakness in global equity markets.

By 12.04pm, the JSE’s all-share index had pulled back 2,38%. The gold mining index fell 3,31%, resources lost 3,21% and the platinum mining index gave up 3,16%. Banks were down 2,49% and financials had weakened 1,78%, while industrials were 1,73% lower.

According to a local equities trader, plenty of activity in derivatives ahead of Thursday’s futures close-out was also accounting for some of the big moves on the JSE on Tuesday.

The rand was bid at 6,89 to the US dollar, from 6,82 when the JSE closed on Friday, while gold was quoted at $796,65 a troy ounce from $791,20/oz at the JSE’s last close.

“The JSE is down quite a bit. It had to play catch up with the movements on international markets,” said a Johannesburg-based equities trader, adding that

while local investors were away for the public holiday, Wall Street had fallen

further ‒ losing over 300 points over the last two trading days.

“It still had to factor that all in,” he said.

He added that there was no buying interest. “Markets are generally quite nervous, and they are very illiquid around this time of the year,” explained the trader.

“I think the move to the downside has been a bit overdone, he concluded.

At noon, resource group Anglo American was down R17,38, or 4,15%, to R401,50, while BHP Billiton fell R6,13, or 2,92%, to R203,97. Sasol was off R5,33, or 1,67%, to R314,67.

Gold miner AngloGold Ashanti dropped R11,70, or 3,99%, to R281,30 and Goldfields shed R2,91, or 2,9%, to R97,40.

Platinum miner Anglo Platinum pulled back R37,62, or 4,02%, to R897,38 and Impala Platinum gave up R6,11, or 2,78%, to R213,94.

Tiger Auto climbed R2,49, or 4,57%, to R56,99 and brewer SABMiller picked up R3,25, or 1,84%, to R180, after it earlier announced that it, together with Koninklijke Grolsch NV, would this week submit a request for approval of the offer memorandum in respect of the SABMiller offer for Grolsch to the Dutch Authority for the financial markets.

On November 19 the two groups announced they had reached conditional agreement regarding the recommended public cash offer by SABMiller for all outstanding shares of Grolsch at an offer price of €48,25 per share.

Elsewhere, healthcare group Netcare dipped 27 cents, or 2,25%, to R11,72. Earlier, it was reported that a consortium led by Netcare has been appointed as the preferred bidder for a public private partnership contract with the government of Lesotho. The cost of the project is estimated at more than R800-million.

Retailer Ellerines eased R1, or 1,25%, to R79 ahead of the Competition Tribunal’s review on Wednesday of African Bank Investments Limited’s proposed acquisition of Ellerines. On Friday, the Competition Commission recommended that the tribunal approve the acquisition without conditions.

Avusa was down 50 cents to R59,50. On Friday it’s share price adjusted lower as a

result of unbundling the Naspers N shares.

Media group Naspers slumped R15,78, or 8,72%, to R165,22. Naspers and Tradus said on Tuesday that they have reached agreement on the terms of a recommended cash offer to be made by Naspers subsidiary Myriad International Holdings BV for the entire issued and to be issued share capital of Tradus at GBP 18 a share.

In the telecommunications sector, fixed-line operator Telkom retreated R3,93, or 2,71%, to R141,07 and mobile operator MTN Group declined R5,70, or 4,58%, to R118,80. – I-Net Bridge

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