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However, after a sharpish drop on Thursday morning the local market recovered and at 13:30 was just slightly below Wednesday’s closing levels.
The initial drop was in reaction to weaker overseas markets, but analysts said the local market is currently so heavily oversold after more than a week of losses that bargain hunting is bound to happen sometime.
Shortly before 14:00 on Thursday, the All-share index was only 0.06% lower at 48 845 points while the Top 40 index was also 0.6% weaker, trading at 43 654 points.
The major indices are also close to support levels, with the Top 40 index trading just above the 200-day moving average.
Among the other major indices the Financial index was only 0.10% lower, the Industrial index gained 0.07% and Resources stocks were only 02.3% weaker, after losing a percentage point in earlier trading.
The uncertainty on the world markets is the result of a degree of inconsistency in US and European economic data on Tuesday, which raises the spectre of slightly slower global growth against the backdrop of an upcoming earnings season and potential for marginally higher rates in the US.
US stocks declined substantially on Wednesday, with investors generally nervous about slightly mixed US economic data and the potential for inconsistent earnings in the weeks ahead.
Read: US stocks sink on economic, Ebola worries
The Dow Jones index traded 1.40% lower, the S&P 500 was 1.32% weaker and the Nasdaq composite index 1.6% softer.
The markets were spooked by disappointing US manufacturing purchasing managers' index data, which was recorded as 57.5 below an anticipated reading of 58.2. Construction spending contracted by 0.8%, also a let-down as analysts expected a marginal improvement.
Investors will be therefore by paying close attention to the European Central Bank’s interest rates decision on Thursday as well as additional economic data out of the US.
The strong dollar retracted somewhat on the disappointing US data which gave the resources sector a break, as commodity prices are currently at record low levels because of the strong dollar.
Among the major resources stocks Anglo American [JSE:AGL] was still 0.77% softer at R246.11, but the share at one stage traded as low as R243.00. BHP Billiton [JSE:BIL] was 0.05% higher at R307.40 after reaching a low of R302.00.
Some resources stocks are still at 52-week lows. Assore [JSE:ASR] lost another 2.15% to reach a new low of R206.30. The share has now lost 11% over the last week and 38.2% over the last 30 days.
Anglo American Platinum [JSE:AMS] lost only 0.10% on Thursday morning to R356.64 but this was enough to reach another 52-week low. The share is now 7.5% weaker than a week ago and 22.7% weaker than a month ago.
- Fin24
