JSE tumbles 2% as China manufacturing data fans global growth worries
The JSE began 2019 on a sour note, tumbling as much as 2% in its biggest one-day drop in a month.
Resource stocks and Naspers, which makes up a fifth of the all share, led losses amid further evidence of slowing growth in China, the top consumer of resources.
The all share was down 1.96% to 51,703.50 points and the top 40 shed 2.35%, as investors bailed out of stocks such as BHP, Anglo American and Mondi plc.
The sell-off came as data showed China’s manufacturing sector contracted in December for the first time in 19 months.
“I think it’s safe to say that after a turbulent and all-round woeful 2018, investors across the globe will be hoping 2019 brings with it more stability and a return to winning ways for stock markets,” Oanda senior market analyst Craig Erlam said.
“That said, the year has already got off to a disappointing start, with risk aversion weighing heavily across asset classes as the trend that battered confidence in the final month of last year carries over into this.
“Naturally, it was a rather quiet end to the year with nothing really changing on the fundamental landscape, but unfortunately during that time of reflection, investors found no reason to be less pessimistic,” he said.
In 2018, global equity benchmarks experienced their worst year since the last financial crisis as investors fretted about the risk of a slowing global economy.
The all share lost 11.4% in 2018, according to Iress data, which excludes the dividends. Only the top end of the resources market fared better among blue-chip stocks in the past year.
But this morning, BHP lost 2.72% to 295.50, after gaining 21% in 2018. Anglo American gave up 2.53% to R314.11 after a 26% gain over the past year. Mondi plc slipped 2.47% to R296.57.
Sasol was down 2.41% to 414.75, hurt by a drop in oil prices. Kumba Iron Ore shed 2.03% to R277.29 and Exxaro 2.15% to R134.90.
British American Tobacco shed 2% to R459, after plunging 43% in 2018. Bidvest shed 2.34% to R202.01.
Old Mutual slipped 3.48% to R21.62 and Sanlam 2.19% to R78.05.
Naspers tumbled 3.89% to R2,779.90, tracking losses in the Chinese technology company Tencent, in which it has a 31% interest.