Johannesburg - The JSE plunged lower at midday due to a broad-based sell-off across emerging markets and in particular emerging market bonds.
“We are seeing fresh sell-off across emerging markets today spurred by a further deterioration in the rand. The currency broke through the key 10.30 level to the dollar‚ igniting the sell-off across the different sectors‚” said Francois Venter‚ an equity dealer at Investec Asset Management.
At 12:30‚ the JSE All Share [JSE:J203] index was down 2.21% to 40 027.25‚ with gold mining shares falling 2.51% and their platinum counterparts shedding 2.91%.
The rand was trading slightly below the intraday high of R10.36/$ at R10.30 against the greenback.
“The disappointing outcome from government’s weekly bond auction earlier today was the primary reason for the currency’s fall‚” Venter said.
Among individual shares‚ Anglo American (AGL) gave up 2.85% to R224.50‚ British American Tobacco (BTI) lost 0.38% to R555.76‚ and breweries giant SABMiller (SAB) skidded 2.93% to R496.49.
Banks and retail stocks fell deeper into negative terrain with Standard Bank (SBK) and First Rand (FSR) down 1.15% to R106.86 and 1.85% to R26.50 respectively.
Mr Price (MPC) gave up 3.63% to R119.88 while Woolworths (WHL) traded 3.66% lower to R64.79.
Africa’s biggest fixed-line operator Telkom (TKG) was down 0.24% to R16.31 after the company announced earlier in the day that it would write down the value of its assets by R12bn‚ reducing the net asset to about R34 per share.