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Johannesburg - South African stocks, including those of safe-haven gold mining firms, slide in a global sell-off as plans to tackle the eurozone’s debt crisis stall.
The benchmark Top 40 - (Tradeable) [JSE:J200] index index was down 1.2% in late morning trade, having fallen 1.9% in earlier trade.
Gold producers, which normally benefit when most stocks are falling, are also on the back foot with spot gold down nearly 2%.
Notable decliners were media firm Naspers [JSE:NPN] down nearly 3% at R364.00 rand and Kumba Iron Ore [JSE:KIO], shedding 3.1% to R58.30.
Copper and gold led a commodities plunge as escalating worries about Europe’s inability to resolve its debt problems drove investors away from riskier assets.
Plans to tackle the eurozone debt crisis have stalled with Paris and Berlin at odds over how to increase the firepower of the region’s bailout fund, French President Nicolas Sarkozy said on Wednesday.
Comments by the Federal Reserve that the US economic outlook grew dimmer in September further reinforced the dismal global economic view.
“The eurozone crisis does remain a key concern for the financial markets and there are murmurs that the Chinese economy could be facing some headwind,” said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia in Sydney.
China slowdown?
China’s economy is set to slow more sharply than previously thought in 2012, with economists in a latest Reuters poll growing more pessimistic about how much a global downturn will impact the world’s manufacturing engine.
London copper dropped for a fourth straight day, while gold was on track to see its biggest daily decline in two weeks. Brent crude hovered near $108 a barrel and grains extended losses.
Three-month copper on the London Metal Exchange tumbled 4% to $6,928.75 a tonne. Prices are headed for a drop of almost 8%this week after two consecutive weeks of gains.
The outlook for metals remained dour, underscrored by a cut in sales forecasts for next year by Freeport-McMoRan Copper & Gold Inc’s. The world’s biggest publicly traded copper producer, facing strikes at two of its mines, cited an uncertain global economic prospect.
The most-active January copper contract on the Shanghai Futures Exchange tumbled to as low as 50 950 yuan ($7 989.024) per tonne in early trading, a 16-month low, after rising 0.4% in the previous session. It is on track for a 9% weekly loss, the biggest since week ended September 25.
“Macroeconomic concerns continue to override those of fundamentals for copper investors, with the eurozone crisis being the chief worry,” said Eric Liu, a trader at CITIC Newedge in Shanghai.
“The Fed’s comment about dimmer US economic outlook weigh down on sentiment but the main reason was Germany’s overnight opposition to some details of the bailout funds.”
France has argued the most effective way of leveraging the European Financial Stability Facility is to turn it into a bank which could then access funding from the ECB, but both the central bank and the German government have opposed this.
The benchmark Top 40 - (Tradeable) [JSE:J200] index index was down 1.2% in late morning trade, having fallen 1.9% in earlier trade.
Gold producers, which normally benefit when most stocks are falling, are also on the back foot with spot gold down nearly 2%.
Notable decliners were media firm Naspers [JSE:NPN] down nearly 3% at R364.00 rand and Kumba Iron Ore [JSE:KIO], shedding 3.1% to R58.30.
Copper and gold led a commodities plunge as escalating worries about Europe’s inability to resolve its debt problems drove investors away from riskier assets.
Plans to tackle the eurozone debt crisis have stalled with Paris and Berlin at odds over how to increase the firepower of the region’s bailout fund, French President Nicolas Sarkozy said on Wednesday.
Comments by the Federal Reserve that the US economic outlook grew dimmer in September further reinforced the dismal global economic view.
“The eurozone crisis does remain a key concern for the financial markets and there are murmurs that the Chinese economy could be facing some headwind,” said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia in Sydney.
China slowdown?
China’s economy is set to slow more sharply than previously thought in 2012, with economists in a latest Reuters poll growing more pessimistic about how much a global downturn will impact the world’s manufacturing engine.
London copper dropped for a fourth straight day, while gold was on track to see its biggest daily decline in two weeks. Brent crude hovered near $108 a barrel and grains extended losses.
Three-month copper on the London Metal Exchange tumbled 4% to $6,928.75 a tonne. Prices are headed for a drop of almost 8%this week after two consecutive weeks of gains.
The outlook for metals remained dour, underscrored by a cut in sales forecasts for next year by Freeport-McMoRan Copper & Gold Inc’s. The world’s biggest publicly traded copper producer, facing strikes at two of its mines, cited an uncertain global economic prospect.
The most-active January copper contract on the Shanghai Futures Exchange tumbled to as low as 50 950 yuan ($7 989.024) per tonne in early trading, a 16-month low, after rising 0.4% in the previous session. It is on track for a 9% weekly loss, the biggest since week ended September 25.
“Macroeconomic concerns continue to override those of fundamentals for copper investors, with the eurozone crisis being the chief worry,” said Eric Liu, a trader at CITIC Newedge in Shanghai.
“The Fed’s comment about dimmer US economic outlook weigh down on sentiment but the main reason was Germany’s overnight opposition to some details of the bailout funds.”
France has argued the most effective way of leveraging the European Financial Stability Facility is to turn it into a bank which could then access funding from the ECB, but both the central bank and the German government have opposed this.
