‘Tired’ JSE led down by weak world markets

A tired-looking JSE was 89 points in the red by noon on Monday as weak global markets continued to weigh.

By midday, the broader all-share index had shed 0,32%. The gold-mining index pulled back 1,42%, resources added 0,05% and the platinum-mining index was up 0,97%. Industrials fell 0,77%, financials were down 0,29% and banks gave up 0,29%.

The rand was bid at 7,82 to the United States dollar from 7,78 when the JSE closed on Friday, while gold was quoted at $923,78 a troy ounce from $916,35/oz at the JSE’s last close.

“Resources are looking slightly better because of a weak rand, but the market is battling and it looks like the Dow is going to open lower,” said a local trader.

“Right now, we are following world markets. This market is looking tired, and one of the weak spots for me is the bank sector — all the big bank stocks look like they are going to break big support levels and they all want to come lower,” he said.

On Friday, the DJIA shed 0,53%, the Nasdaq edged up 0,52% and the S&P 500 declined 0,42%. In Asia on Monday, the Hang Seng weakened 3,64%, while Japanese markets are closed. The United Kingdom’s FTSE 100 was 0,29% lower.

The dealer explained that there was still a lot of subprime and interest-rate concerns globally, adding that most bank stocks internationally were looking weak.

Looking at the platinum-mining sector, the trader said that platinum stocks were starting to lose some steam.

“If the platinum price hits the $2 000 level, then these platinum stocks could go up, but right now they are at a certain level and they just don’t want to go any higher,” he said.

The platinum price was trading at $1 898, up $7,50 from its close.

“The negative feeling in this market is still persisting, and if I look at my chart formations, it looks like this market wants to go lower,” he said.

On the JSE, resource group BHP Billiton eased 50 cents to R225, Anglo American was off R1,15 to R448 but Sasol collected R5,50, or 1,56%, to R357.

Gold miner AngloGold Ashanti gave up R6,51, or 2,3%, to R276,49 and Harmony retreated R2, or 2,6%, to R75.

Anglo Platinum dipped R21,98, or 1,95%, to R1 107,01 after it earlier reported a 2,8% drop in its diluted headline earnings per share (HEPS) for the year to end December 2007.

The company’s FY07 diluted HEPS was R52,01 compared with R53,52 for the full year to end December 2006.

Platinum production from mining operations decreased by 6% to 2,47-million ounces in 2007 as a result of reduced labour efficiency and interventions aimed at achieving a significant improvement in employee safety.

Impala Platinum gained R7,01, or 2,38%, to R302,01 and Lonmin improved R17,99, or 3,89%, to R480.

Brewer SABMiller declined R1,70, or 1,01%, to R165,90 and luxury goods group Richemont shed 32 cents to R41,98.

Fixed-line operator Telkom edged up 77 cents to R134,02, but mobile operator MTN Group was 95 cents lower at R110,05.

Banker Absa slipped 26 cents to R97,74 and Standard Bank fell R1,24, or 1,23%, to R99,77.

Absa said earlier that it expects the group’s headline earnings per share and earnings per share for the year ended December 2007 to be between 15% and 19% higher compared with the year ended December 2006.

Absa Bank’s HEPS and EPS are expected to be between 25% and 28% higher compared with the year before. — I-Net Bridge

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Nicole Rego
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