South African stocks closed more than 640 points weaker on Monday, dragged lower by falling metal counters and a weaker opening on Wall Street.
The local bourse was in negative territory throughout the session, having taken direction from weaker world markets as negative global sentiment and worry continued to weigh.
By 5pm, the JSE all-share index had shed 3,14%, with resources falling 3,76%, platinum miners giving up 5,44% and gold stocks easing 0,69%.
Banks lost 4,99%, financials weakened 3,38% and industrials shed 2,31%.
The rand was last bid at 10,27 to the dollar from 10,13 when the JSE closed on Friday, and gold was quoted at $917,57/oz a troy ounce from $925,90/oz
at the JSE’s last close. Platinum was at $965,50/oz from its previous close of $985,50/oz and Brent crude was at $44,60 per barrel from a previous close of $45,88 per barrel.
“We were hit quite hard across the board today. European markets were weaker and the Dow opened lower,” an equities trader said.
“There is still a lot of nervousness and markets are still skittish.
“The dollar has strengthened and metals have come under a lot of pressure. The rand has also weakened, but as a function of risk aversion.”
He noted that the local market would continue to be led by what happens in the Dow and in European markets.
“Earnings from the various companies will dictate where the market goes,” he added.
Dow Jones Newswires reports that stocks slid in the United States, following markets in Europe and Asia lower, as anxiety generated by the global economic downturn continued to cast a shadow.
Unease over the global economic slowdown and the effect that will have on corporate profits isn’t expected to dissipate anytime soon, said analysts.
The DJIA was last down 1,07%.
On the JSE, resources giant Anglo American (AGL) gave up R8,61, or 4,63%, to R177,36 and BHP Billiton (BHP) lost R7,23, or 4,15%, to R167,02.
Petrochemicals group Sasol (SOL) fell R11, or 3,99%, to R265.
Paper group Sappi (SAP) shed R3,40, or 10.18%, to R30, and rival Mondi (MND) gave up 70 cents, or 2,19%, to R31,30.
Sappi earlier reported basic earnings per share of six US cents for the quarter ended December, after a loss of nine cents for the quarter ended September
2008, but down from EPS of 12 cents for the December 2007 quarter.
Basic EPS for the December quarter was favourably impacted by special items of six US cents per share, the group said.
The group also said that the sharp decline in demand and the inventory reductions in the downstream supply chains for its products in the latter part of the last quarter has continued in January in most of its businesses.
The impact on the sales of chemical cellulose was particularly sudden and is continuing, it said.
In Europe demand for coated graphic paper was particularly weak in the first half of January. The group curtailed output by about 25% in January and will continue to match output to demand going forward.
The group also disclosed that 2009 capex had been cut to $300-million or lower.
ArcelorMittal (ACL) lost R4,45, or 5,50%, to R76,50, Kumba Iron Ore (KIO) weakened R8,90, or 5,97%, to R140,10 and Highveld Steel (HVL) lost R1,60, or 3,10%, to R50.
Gold miner AngloGold Ashanti (ANG) weakened R2,25 to R284 and Harmony (HAR) gave up R2,89, or 2,40%, to R117.56.
Gold junior Aflease Gold (AFO) was two cents, or 1,27%, firmer at R1,60. Earlier, it confirmed that its status as a near-term producer and said it was within weeks of becoming an international gold company through its merger with Australia BMA Gold. Providing a strategic and operational update, Aflease said its Modder East project on the Witwatersrand was scheduled to pour its first gold in the fourth quarter of this year.
Platinum miner Anglo Platinum (AMS) fell R29, or 6,82%, to R396, Impala Platinum (IMP) gave up R5,92, or 4,98%, to R113 and Lonmin (LON) was down R1,47, or 1,17%, to R124,33.
In diversified miners, African Rainbow (ARI) was off R11, or 9,17%, to R109, Exxaro (EXX) gave up R2,74, or 4%, to R65,70 and Hulamin (HLM) weakened 26 cents, or 2,01%, to R12,69 rand.
Copper miner Palabora Mining Company (PAM) was down R1,90, or 3,17%, to R58. The company earlier reported headline earnings per share of R14,93 for 2008 compared with headline earnings per share of R14,91 in 2007. Net profit for the year decreased marginally from R722-million in the previous year to R720-million, or R14,89 a share compared with R14,93 per share in 2007.
Elsewhere on the JSE, SABMiller (SAB) was down R3,90, or 2,37%, to R160,60, Remgro (REM) was off R2,90, or 4,08%, to R68,10, Famous Brands (FBR) weakened 45 cents, or 2,82%, to R15,50 and Tiger Brands (TBS) fell R3,39, or 2,40%, to R137,60.
However, Imperial (IPL) was up R1,35, or 2,63%, to R52,75.
Among banks, Standard Bank (SBK) was down R3,40, or 4,80%, to R67,50, Nedbank (NED) weakened R2,50, or 2,75%, to R88,50, Absa (ASA) fell R1,75, or 1,88%, to R91,25 and FirstRand (FSR) lost one rand, or 6,71%, to R13,90.
Moody’s Investors Service said earlier that it had downgraded the long-term global local currency (GLC) deposit rating of Absa Bank Limited to Aa3 from
Aa2. The outlook on the rating is negative.
Financial services group Old Mutual (OML) was off 52 cents, or 6,67%, to R7,28, Sanlam (SLM) lost 45 cents, or 2,78%, to R15,75 and RMB Holdings (RMB) fell R1,78, or 7,76%, to R21,17.
Sugar group Illovo (ILV) lost 61 cents, or 2,56%, to R23,25.
Media group Naspers (NPN) shed R5,55, or 3,53%, to R151,50 and Avusa (AVU) lost 30 cents, or 1,69%, to R17,50.
Business Connexion Group (BCX) was down 10 cents, or 2,70%, to R3,60. The group said earlier that its headline earnings per share for the six months ended November 30 2008 are anticipated to be between 30% and 40% lower than the previous reporting period.
Retailer Woolies (WHL) weakened 54 cents, or 4,01%, to R12,91, Pick n Pay (PIK) gave up R1,65, or 4,76%, to R33 and Shoprite (SHP) shed R2,34, or 4,29%, to R52,16.
However, Lewis (LEW) was up R1,05, or 2,44%, to R44,05.
Liberty International (LBT) shed R1,94, or 3,59%, to R52,06.
Construction group Aveng (AEG) lost R1,40, or 5,30%, to R25 and Murray & Roberts (MUR) fell R2,20, or 5,09%, to R41.
Cement manufacturer Pretoria Portland Cement (PPC) weakened R1,35, or 4,56%, to R28,25.
Among telecommunications groups, MTN Group (MTN) lost two rand, or 2,04%, to R96 and Telkom (TKG) gave up R3,75, or 3,23%, to R112,50. — I-Net Bridge.