JSE slips to two-week low on weaker world markets
The JSE dipped a little on Wednesday, as investors further trimmed their exposure to the recently high-flying resources sector.
The resources index shed almost 2%, pulled down by the larger diversified miners. Weaker iron ore and copper prices, coupled with broker downgrades of some of the shares, dented sentiment in the sector.
As a result, the all share was off 0.14% to 59,434 points by lunchtime, its weakest point in nearly two weeks.
A strong performance by industrial heavyweight Naspers, however, kept losses in the overall market in check. Naspers rose 2.98% to a record R3,698.50, following gains by Hong Kong-listed Tencent, in which it owns about a third.
The buoyant market reaction followed third-quarter results from Tencent, which reported a 69% rise in net profit to $2.71bn on a year-on-year basis.
Sentiment elsewhere in the local share market was mostly weaker, though part of it came from trading updates.
Netcare was a case in point, with its shares falling 6.3% to R23.66, after flagging a drop of up 27.5% in full-year adjusted headline earnings per share (HEPS). Life Healthcare also took a hit, shedding 5.34% to R24.29.
Consumer goods group Steinhoff has battled to find buying support since claims came to light last week that it was involved in an accounting irregularity. The company has dismissed the report, but the market appeared to be taking a different view. Its share price dropped a further 2.23% to R52.67, bringing cumulative losses since the news broke to about 13%, which equates about R38bn in lost market capitalisation.
"Investors we have spoken to have raised a few red flags over the company, choosing to stay away rather than buy a stock which appears attractive at these levels," said Michele Santangelo, analyst at Vunani Private Clients.
Europe’s leading markets were higher at midday, following a weaker session in Asia, where Japan’s Nikkei 225 lost 1.57%.
Anglo American was off 3.41% to R268.03, BHP 2.24% to R257.94, and Sasol 1.86% to R428.54.
Kumba Iron Ore lost 1.9% to R291.13, Exxaro 1.94% to R145.86, and African Rainbow Minerals 2.63% to R120.74.
Anglo American Platinum shed 2.16% to R387.62 and Impala 2.91% to R36.02. However, AngloGold Ashanti gained 2.15% to R140.40 and Gold Fields 2.19% to R55.95.
Nedbank lost 1.43% to R208.13 and Sanlam 1.38% to R71.58.
Remgro relinquished 1.86% to R204.37 and Brait 2.03% to R47.70.
Spar gave up 1.79% to R167.64.