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Johannesburg - The JSE followed the US and Asian markets lower on Thursday, after these markets were shocked by the prospect that interest rates in the US, which is on historically low levels, might rise sooner than later.
But by midday, most of these losses were recovered as investors rebalanced their portfolios for the futures close out later in the day.
After opening sharply lower, the All Share index was only 0.08% lower on 46 631. The Top 40-index was slightly down on 41 954.
The US markets were firmly in the red after comments by Federal Reserve chair Janet Yellen at a media briefing after a two day meeting of the Fed’s open market committee.
The Dow Jones index, which traded more than 200 points lower, eventually closed down 114 points at 16 222. The S&P 500 gave up 11 points to close at 1 861, while the tech-heavy Nasdaq dipped 26 points to 4 308. Most markets in the East also traded lower.
The Fed said it would cut a further $10bn a month off its bond-buying scheme, saying the economy was picking up and a recent spate of soft data was caused by severe winter weather.
This was expected, but investors were rattled when Yellen said that the time frame for an interest rate hike could be "on the order of around six months" after the stimulus ends.
The Fed said it would do away with its target of 6.5% unemployment and 2.5% inflation before weighing an interest rate increase from the current record lows.
Higher interest rates in the US is particularly bad for emerging markets such as South Africa, because it will encourage foreign investors to repatriate their money from emerging markets back to the higher returns in the US.
But these worries were pushed aside as investors were more interested in getting their positions right for the futures close out.
Naspers [JSE:NPN], which lost more than 4% on Wednesday, started Thursday also more than 4% down, but recovered quickly and was trading 2.15% higher at R1 185.02 just before midday.
On Wednesday, the share suffered another setback when it became known that Tencent, the Chinese internet company of which Naspers owns 34%, announced lower earnings for the first quarter. Although Tencent’s income was higher, the profit was hit by higher capital investment in its e-commerce business.
The resources sector initially continued its downward slide and was at one stage 1.08% lower on 53 736 points, but by midday it was down only 0.19% at 54 218 points. When the current correction started the index was trading around 58 000.
Among the biggest losers were Harmony Gold [JSE:HAR] (-3.09% at R35.76) and Anglogold Ashanti [JSE:ANG] (-2.4% at R195.35).
Super Group which rallied on the news that Steinhoff [JSE:SHF] (-1.15% at R51.40) wants to increase its holding to 98%, gave up 2.05% to R27.71.
But by midday, most of these losses were recovered as investors rebalanced their portfolios for the futures close out later in the day.
After opening sharply lower, the All Share index was only 0.08% lower on 46 631. The Top 40-index was slightly down on 41 954.
The US markets were firmly in the red after comments by Federal Reserve chair Janet Yellen at a media briefing after a two day meeting of the Fed’s open market committee.
The Dow Jones index, which traded more than 200 points lower, eventually closed down 114 points at 16 222. The S&P 500 gave up 11 points to close at 1 861, while the tech-heavy Nasdaq dipped 26 points to 4 308. Most markets in the East also traded lower.
The Fed said it would cut a further $10bn a month off its bond-buying scheme, saying the economy was picking up and a recent spate of soft data was caused by severe winter weather.
This was expected, but investors were rattled when Yellen said that the time frame for an interest rate hike could be "on the order of around six months" after the stimulus ends.
The Fed said it would do away with its target of 6.5% unemployment and 2.5% inflation before weighing an interest rate increase from the current record lows.
Higher interest rates in the US is particularly bad for emerging markets such as South Africa, because it will encourage foreign investors to repatriate their money from emerging markets back to the higher returns in the US.
But these worries were pushed aside as investors were more interested in getting their positions right for the futures close out.
Naspers [JSE:NPN], which lost more than 4% on Wednesday, started Thursday also more than 4% down, but recovered quickly and was trading 2.15% higher at R1 185.02 just before midday.
On Wednesday, the share suffered another setback when it became known that Tencent, the Chinese internet company of which Naspers owns 34%, announced lower earnings for the first quarter. Although Tencent’s income was higher, the profit was hit by higher capital investment in its e-commerce business.
The resources sector initially continued its downward slide and was at one stage 1.08% lower on 53 736 points, but by midday it was down only 0.19% at 54 218 points. When the current correction started the index was trading around 58 000.
Among the biggest losers were Harmony Gold [JSE:HAR] (-3.09% at R35.76) and Anglogold Ashanti [JSE:ANG] (-2.4% at R195.35).
Super Group which rallied on the news that Steinhoff [JSE:SHF] (-1.15% at R51.40) wants to increase its holding to 98%, gave up 2.05% to R27.71.
