MARKET WRAP: JSE slips almost 1.5% in risk-off trade

The JSE fell sharply on Friday, under pressure from a weaker rand and disappointing corporate news, resulting in broad-based losses.

The mood on global markets was risk-off, with a hawkish US Federal Reserve policy statement on Thursday putting both the rand and equities under strain.

The all share lost 1.42% to 53,295.3 points and the top 40 fell 1.56%. Industrials fell 1.67% and resources 2.24%. The all share gave up 1.8% for the week.

Naspers fell 1.83% to R2,744.92, after Tencent fell sharply, amid a broader-based sell-off of tech stocks. Tencent also announced during the week it was cutting its marketing budget for its games business, as Chinese authorities tighten regulation.

Corporate news was also negative, with rand hedge Richemont slumping 6.4% to R96.78, after saying that headline earnings per share (HEPS) fell 2% to R2.58 in the six months to end-September.

Risk appetite on global markets, given a lift earlier in the week by the US midterm elections, had also ebbed by Friday morning.

Local data on Thursday had disappointed, with mining output contracting rather than growing in September, although analysts said SA had probably escaped recession in the third quarter.

Local focus next week will shift to retail sales data on Thursday, which should give some indication of whether SA exited its technical recession in the third quarter.

Diversified miner Glencore fell 3.22% to R56.52, BHP 2.23% to R292.58 and Anglo American 2.12%.

Sasol gave up 2.84% to R472.96.

Gold Fields fell 2.56% to R38.86, amid continued problems at its South Deep mine.

Stefanutti Stocks rose 3.13% to R3.30, extending Thursday's 7.02% rise, which had followed news it grew HEPS 46% in the six months to end-September.

Tiger Brands rose 0.27% to R280.86, despite saying in a statement earlier that HEPS were expected to decline by between 20% and 25% in the year to end-September.

Tongaat Hulett slumped 6.1% to R61.30, after saying earlier it expected its headline loss for the six months to end-September to grow 113%, due to poor market conditions in SA and Mozambique.

Net1 UEPS crashed 46.86%, after reporting group revenue dropped 17% to $126m in the year to end-September, with profit under pressure from the cancellation of its social grants contract.

Life Healthcare fell 0.77% to R25.84, despite saying that it expected HEPS for the year to end-September to grow up to 45%, and basic earnings per share up to 77%.

Shortly after the JSE closed the Dow was off 0.6% at 26,033.26 points, while in Europe, the FTSE 100 had lost 0.7%, the CAC 40 0.66% and the DAX 30 0.13%.

At the same time, gold had fallen 1% to $1,211.20 an ounce and platinum 0.76% to $856.96. Brent crude was 1.68% lower at $69.61 a barrel.

gernetzkyk@businesslive.co.za