THE JSE extended losses at noon today, retreating nearly 3% as investors fret about the health of the global economy even after massive bank bailouts, traders said.
Gains on the local bourse were largely restricted to the gold mining sector, with the bullion price climbing as recession fears spurred a fresh round of safe haven-related demand. While investors worldwide welcomed swift coordinated moves by world governments and central banks to contain the credit crisis, PSG Konsult trader Hennie Fourie said that "the rescue packages won’t suddenly improve the earnings outlook" for crippled banks across the world.
"The credit crisis is under control, but that doesn’t remove worries on global slowdown," one Johannesburg-based trader said. At midday, the all share index was down 2,93% at 21,469,1, weighed down by a 5,45% decline in resources and a 5,35% fall the platinum mining index. However the gold mining index rallied 4,66%. Banks fell 0.86%, financials
were down 0,61% and industrials gave up 1,40%.
The rand was bid at R9,23 to the dollar from R8,97 when the JSE closed yesterday, while gold was last quoted at $846,90 a troy ounce from $841.35/oz at the JSE’s last close.
European stocks stay mired in red as investors fret over what impact a global recession will have on corporate profits. DJ Eurostoxx 50 was last down 1,6% at 2711,83. "With structural risks now subsiding, investor risk sentiment is likely to converge with the economic cycle and concerns about recession across major economies may stand in the way of any major risk recovery from here," says Lena Komileva at Tullet Prebon, Dow Jones
Newswires reports.
Back in Johannesburg, Anglo American (AGL) plummeted R26,15, or 9,98%, to R236 and rival BHP Billiton (BIL) slumped R9,81, or 5,86%, to R157,68. Sasol (SOL) sank R17,88, or 6,18%, to R271,60. Platinum miners were also hit hard as the white metal prices buckled
under the pressure of expected decline in demand owing to global recession fears, traders said. Anglo Platinum (AMS) dived R34,28, or 5,01%, to R649,61 and Impala Platinum (IMP) fell R8,15, or 5,36%, to R143,85.
But gold miners bucked the weaker trend on a higher bullion price, with AngloGold Ashanti (ANG) gaining R12,01, or 6,04%, to R211 and Gold Fields (GFI) rising R4,05, or 5,49%, to R77,87. Elsewhere, brewer SABMiller (SAB) was up 79 cents to R149,46, but luxury goods group Richemont (RCH) fell 126 cents, or 3,41%, to R35,64 and Imperial (IPL) plunged R3,18, or 5,39%, to R55,82.
Among banks and financials, Standard Bank (SBK) eased R1,01, or 1,25%, to R79,99 and Absa (ASA) inched down 30 cents to R103,50, but Old Mutual (OML) edged up three cents to R11,70.
In the news, IT group Datatec (DTC) tumbled 210 cents, or 9,29%, to R20,50 after reporting headline earnings per share of US17,6 cents for the six months ended August – up 5% from 16,8 cents a year ago. Dimension Data (DDT) fell 32 cents, or 5,47%, to R5,53. It said earlier that shareholders in its Asian subsidiary, Datacraft Asia Ltd, had voted in favour of an offer by Dimension Data to buy the remaining 44,9% stake that it does not already own.
Retailer Pick n Pay (PIK) was up 10 cents to R29. It said late yesterday that it expects diluted headline earnings per share from continuing operations for the six months ended August to be between 15% and 25% higher
than the same period last year.
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