JSE falls 457 points on European debt

The JSE extended earlier losses and was over 450 points weaker at midday as markets continued to be concerned about eurozone sovereign debt.

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The JSE extended earlier losses and was over 450 points weaker at midday on Friday as markets continued to be concerned about eurozone sovereign debt.

A local trader said that the real reason behind the lower European markets, which the JSE tracks, was global worry about European banks having to now “look at other ways of raising capital, which could lead to a liquidity squeeze.”

By 12:16 local time, the JSE all-share index was off 457 points or 1.56%, with resources falling a strong 2.30%, followed by a 1.93% decline in platinum miners. Industrials were 1.23% softer, financials were down 0.85%, and banks slid 0.58%. Gold miners were also down 0.23%.

The rand was bid at 7.22 to the dollar, from 7.20 at the JSE's close on Thursday. Gold was trading at US$1,877.11 a troy ounce from US$1,826.84/oz at the JSE's previous close, while platinum was at US$1,879.50/oz, from US$1,833.50/oz previously.

Dow Jones Newswires reported that European stocks have pushed sharply lower on Friday, with investor sentiment mired in continued concern about the European debt crisis, coupled with data indicating an almost stagnant global economy.

Still, “economic data and the European sovereign/banking crisis will probably continue to dominate market action,” said Gary Jenkins, head of fixed-income research at Evolution Securities. “This week has seen a continuation of the trend of weaker-than-expected data and political reaction to the European problems.”

By 10:25 SA time, the Stoxx Europe 600 index had dropped 2.0% to 222.04, and the CAC-40 index in Paris had shed 2.4% to 3003.19. Frankfurt's DAX index had slumped by 3.1% to 5432.02.

London's FTSE 100 had slid 2.8% to 4949.65 at 12:01 local time.

In Asia, shares were sharply lower Friday as renewed concerns the global economy will tip back into recession gripped investors.

Japan's Nikkei Stock Average closed down 2.5%, while South Korea's Kospi Composite lost 6.2%, its biggest single-day drop since November 2008. Hong Kong's Hang Seng Index dropped 3.1%, Australia's S&P/ASX 200 fell 3.5%.

US stock futures tumbled on Friday, pointing to further losses for Wall Street as global equity markets dropped on fears over global growth and the health of Europe's banking system.

Futures on the Dow Jones Industrial Average dropped 166 points to 10851. Standard & Poor's 500 Index futures declined 19 points to 1124.50, while Nasdaq 100 futures lost 26 points to trade at 2056.

On the JSE, Anglo American (AGL) lost 7.29 rand or 2.63%, to 269.69 rand, BHP Billiton (BIL) plummeted 8.50 rand or 3.78%, to 216.50 rand. Sasol (SOL) was down 2.93 rand to 307.27 rand.

Among gold shares, Harmony (HAR) was down 3.13 rand, or 3.42%, at 88.52 rand, but Goldfields (GFI) added 1.28 rand or 1.08% to 120.03 rand. Anglo Gold Ashanti (ANG) was flat (-5 cents) at 327 rand.

Among platinum stocks, Lonmin (LON) gave up 4.23 rand, or 3.13%, to 131 rand, Anglo Platinum (AMS) was 17.50 rand, or 3.19% lower at 531.50 rand, and Northam Platinum (NHM) fell 75 cents or 2.21% to 33.25 rand.

Exxaro (EXX) lost 618 cents or 3.61% to 164.83 rand.

ArcelorMittal (ACL) was off 1.95 rand, or 3.31%, to 57 rand.

Industrials were also in the red. Bidvest (BVT) gave up 4.50 rand, or 3.06%, to 142.50 rand, and Barloworld (BAW) lost 1.84 rand or 3.03% to 58.86 rand.

Mustek (MST) gained eleven cents or 2.21% to 5.09 rand. The branded assembler and distributor of PCs, notebooks and related products said on Friday that it anticipated headline earnings per share to be between 50% and 60% higher for the year ended June 30, than restated headline earnings per share of 57.84 cents previously.

The group said it would publish its results on about August 26.

WBHO (WBO) fell 2.50 rand or 2.50% to 97.50 rand, while Murray and Roberts (MUR) lost 34 cents or 1.25% to 26.86 rand.

Retailer Truworths (TRU) was 95 cents or 1.30% off at 72.19 rand. - I-Net Bridge

Source: http://www.iol.co.za/jse-falls-457-points-on-european-debt-1.1121509

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