The JSE extended its earlier losses by midday, in line with the softer tone of global bourses. The only bright spot was gold miners, but even then the index was only up a third of a percent.
|||The JSE extended its earlier losses by midday on Thursday, in line with the softer tone of global bourses. The only bright spot was gold miners, but even then the index was only up a third of a percent.
By 12:10 local time, the JSE all-share index was off 1.41%, dragged lower by a 1.75% fall in resources and a 1.86% decline in platinum miners. However, gold miners were up 0.33%.
Financials were off 1.11%, banks shed 1.51% and industrials were 1.32% softer.
The rand was bid at 7.13 to the dollar, from 7.06 at the JSE's close on Wednesday. Gold was trading at US$1,797.70 a troy ounce from US$1,784.72/oz at the JSE's previous close, while platinum was at US$1,836.50/oz, from US$1,834.20/oz previously.
A local trader said the JSE was following world markets lower as global sentiment was hit by reports that Morgan Stanley had lowered its growth forecasts for 2011 and 2012 on the world economy.
He added that the main focus of attention later today would be the weekly US jobs data.
Dow Jones Newswires reported that US stock futures slumped on Thursday, as fears over global growth prospects and Europe's ongoing sovereign debt problems weighed on equity markets around the world.
Futures on the Dow Jones Industrial Average fell 168 points to trade at 11213. Standard & Poor's 500 index futures dropped 21.2 points to 1168.70, while Nasdaq 100 futures lost 44.25 points to trade at 2131.
After bouncing back last week on the heels of short-selling bans in Europe, equities have seen renewed pressure on concerns about slowing global growth and concerns that European leaders haven't yet moved to ringfence the eurozone's sovereign debt problems, said Michael Hewson, market analyst at CMC Markets in London.
While it's difficult to pinpoint a single catalyst behind the current bout of selling pressure, the weakness appears in part to be a delayed reaction to the failure of German Chancellor Angela Merkel and French President Nicolas Sarkozy to come up with concrete proposals to address the region's debt problems at a meeting earlier this week, he said.
As a result, investors appear to be rotating out of cyclical equities into safe havens, such as gold, he said.
The latest round of data on first-time claims for U.S. unemployment benefits are set for release at 8:30, EDT. Economists surveyed by MarketWatch expect initial claims to rise to 400,000 from 395,000 the previous week.
European stocks saw heavy pressure, tracking losses in Asian markets amid worries over stalling global growth. Japan's Nikkei Stock Average fell 1.3% to close at its lowest level since March 15.
The FTSE 100 was last off 1.9%.
On the JSE, Anglo American (AGL) lost 5.07 rand or 1.76%, to 283.29 rand, BHP Billiton (BIL) shed 6.41 rand or 2.71%, to 230.10 rand. Sasol (SOL) was down 4.88 rand, or 1.5%, to 317.62 rand.
Among gold shares, Harmony (HAR) was up 1.03 rand, or 1.13%, at 92.13 rand, Goldfields (GFI) added 21 cents to 119.22 rand and Anglo Gold Ashanti (ANG) added 65 cents to 327.15 rand.
Among platinum stocks, Impala Platinum (IMP) was down 3.32 rand, or 1.89%, to 172.68 rand and Anglo Platinum (AMS) was 7.96 rand, or 1.4%, lower at 554 rand.
Northam Platinum (NHM) fell 85 cents or 2.44% to 33.95 rand. The mid-tier platinum producer reported a 49.7% fall in its full year headline earnings on lower platinum group metal sales volumes and to a lesser extent the increase in the weighted average number of issued shares.
The company's headline earnings for the full year to end June 2011 came in at 89.5 cents from 177.8 cents previously as sales revenues dropped 9.5% to 3.6 billion rand from 3.9 billion rand the year before.
Sales revenues dropped after metal sales volumes fell 19.8% to 317,392 ounces over the year. The company's production was severely impacted by production stoppage due to a strike at its Zondereinde operations.
The company declared a modest full year dividend of 10 cents a share.
Exxaro (EXX) lost 124 cents to 180 rand. South African based diversified resources group posted a 53% jump in interim headline earnings per share as it capitalised on the positive market recovery for coal in terms of price and demand.
Headline earnings, which exclude the impact of any impairments, were 3.6 billion rand or 10.45 rand a share, compared to corresponding 2010 earnings of 2.4 billion rand or 6.83 rand a share. Attributable earnings, inclusive of Exxaro's 20% interest in the post-tax profits of Sishen Iron Ore Company (SIOC) amounted to 2.4 billion rand as well as the respective 5 million rand and 147 million rand contributions from the equity interests in Chifeng and Black Mountain, increased by 33% to 3.2 billion rand or 9.21 rand a share. The group declared an interim dividend of three rand a share, which is covered three times by attributable earnings.
Kumba (KIO) was off 12.96 rand, or 2.8%, to 447.03 rand.
Among industrial stocks, Bidvest (BVT) gave up six rand, or 3.87%, to 149 rand.
Earlier the company said that it has not only decided to hang on to its Foodservices interests, but has decided to pursue growth in the division.
It has concluded Memorandums of Understandings to purchase foodservice businesses in Egypt, the Baltics, and Chile - its first entry into the high growth South American market.
The group said on Thursday that it had received several unsolicited proposals for its foodservice interests, but these have been turned down by the board.
A local equities trader noted that the share price had spiked when the initial cautionary announcement advising shareholders of the various unsolicited proposals relating to its Foodservice Business was issued in July.
So the decline today is related to the announcement that Bidvest has decided to reject the proposals, the trader added.
The overall market is also weaker this morning, the trader added. The General Industrials (J272) index was down 3%.
SABMiller (SAB) was 7.81 rand, or 3%, in the red at 244.09 rand. Earlier Australian brewing firm Foster's rejected a US$10-billion cash takeover offer from SABMiller, saying that the valuation price was too low.
SABMiller announced on Wednesday that it intended to make an unsolicited highly conditional “takeover offer” for all the shares in Foster's Group at a price of AU$4.90 per share in cash, reduced by the amount of any dividend or distribution paid or declared by Foster's after August 17.
It follows a similar offer, tabled in June, by the world's second largest brewer. - I-Net Bridge
Source: http://www.iol.co.za/jse-extends-losses-1.1120620
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