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JSE kept red in thin trade

Dec 19 2011 13:48 I-Net Bridge

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Johannesburg - The JSE was on the back foot in midday action on Monday, marginally off its opening levels in thin trade as markets continued to react to the confirmed death of Northern Korean leader Kim Jong Il.

At 12:01 local time, the all share index was 0.80% lower. The resources index lost 1.05 and gold stocks slid 0.45% with the platinum index losing 1.30%.

Financials were 0.74% down, while industrials lost 0.60% and banks lowered 1.40%.

A local dealer noted that banks led the downside momentum, while resource stocks also declined, but trade was thin, as to be expected in the run up week to Christmas.

He said that some of Monday's negative action was as a result of catch-up due to the public holiday on Friday.

The rand was bid at 8.36 to the dollar, from 8.38 at the JSE's close on Thursday. Gold traded at US$1,595.55 a troy ounce from US$1,602.92/oz at the JSE's previous close, while platinum was quoted at US$1,417.50/oz, from US$1,418/oz at the previous close.

Dow Jones Newswires reported that US stocks were expected to open marginally higher on Monday, as European markets recover from opening lows. Traders would attempt to shrug off credit-rating fears after Fitch Ratings put six eurozone countries on review for a possible downgrade late last Friday. Traders noted that Fitch affirmed France's triple-A rating on Friday, despite lowering its long-term outlook on the country, which has offered some comfort. Still, caution would persist amid low volumes, with participants refraining from building exposure to equities in the run-up to the Christmas break.

Asian stock markets also dropped on Monday, with South Korea's stock market and the won tumbling to multi-week lows on news of North Korean leader Kim Jong Il's death.

South Korea's Kospi Composite briefly fell 4.4% to its lowest level since mid-October. "What I can say now is that the shock on the market will be inevitable in the short term," said Hyundai Securities analyst Bae Sung-young. The US dollar, considered a safe-haven, rose broadly after North Korean state television said Kim died from fatigue during a train ride on Saturday.

Japan's Nikkei Stock Average fell 1.3%. Taiwan's Taiex index slipped 2.2%, while Hong Kong's Hang Seng Index fell 1.2% and China Shanghai Composite slipped 0.3%.

 
 
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