Johannesburg - The JSE closed weaker on Monday afternoon‚ with fears mounting that Spain might need a formal bailout casting a shadow on local markets‚ and sending world markets tumbling as risk aversion returns.
“The main issue is the uncertainly about the future of Greece and once again Spanish problems with the Spanish regulator announcing that it had banned short-selling of stocks for three months‚ which added to general nervousness in markets‚” said Francois du Plessis‚ director at Vega Asset Management.
“Also a concern is the stronger dollar — which is seen as a safe haven currency — which will eat into multi-national profit margins going forward‚” he said.
“Today saw risk-aversion across the globe which affected metal and minerals negatively‚ as they are very exposed to risk-aversion. The stronger the dollar the more expensive it is to buy commodities and therefore we have seen local declines in metal and mineral counters‚” he added.
At 17:00 local time‚ the All Share [JSE:J203] index was down 1.20% to 33 814.83. Anglo American‚ which lost R7.50‚ or 2.85%‚ to R255.50 and BHP Billiton gave up R4.90‚ or 2.08%‚ to R230.68 were some of the biggest losers in general resources.