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Johannesburg - The dollar’s woes continued to be the main story on the financial markets on Tuesday, with gold shares seemly the biggest JSE benefactors from the greenback's slide to a new 18-month low against the yen.
The Gold index was the only major index on the JSE which in the black amid a sea of red. The All Share and Top 40-indices were both down more than 1.7% in post-lunch time trade.
Gold shares are supported by the higher gold price, which gained another $7 to trade at $1 298.00 per fine ounce. By 14:00 the Gold index was up over 2%.
A softer dollar is also supposed to support resources shares, but the mood in the sector was spoiled by another survey showing a slowdown in activity at China's factories.
The local market was also in line with global markets with the Asian and European markets both trading lower on Tuesday, as investors grew doubtful about global central banks' ability to boost growth through aggressive policy easing.
The All Share-index was down 1.71% at 52 049 points, while the Top 40-index dropped 1.76% to 45 653 points. The Industrial index, with a lot of dual-listed shares, lost 1.01%, while the Financial index gave up 2.74%.
The gold market received an unexpected boost when DRD Gold [JSE:DRD], the higher flyer among the gold shares, surprised the market with a third quarter dividend of 38 cents per share.
The company’s total distribution for the 2016 financial year now stands at 50c/share, compared with the total distribution of 10c/share declared at the end of the 2015 financial year.
Niël Pretorius, CEO of DRD Gold, said the very significant weakening of the rand, coupled with higher production and stable costs, pushed the company’s net cash and cash equivalent position up at the end of the third quarter to beyond R410m.
DRD Gold’s share price was at one stage more than 4% higher on R8.20, but by 14:00 it was only 0.77% higher at R7.89 - yet another 52-week high. Investors in DRD Gold have now earned a return of 244.93% over the past ninety days on their investment.
Harmony Gold [JSE:HAR], which gained a massive 263.28% over the past 90 days and 393.63% over the past 60 days, was 1.41% stronger on R51.06.
Gold Fields [JSE:GFI] was up 3.71% at R67.08, Anglogold [JSE:ANG] added 2.88% to R232.51, and Sibanye Gold [JSE:SGL] 0.45% at R53.84.
The two biggest shares in the resources sector were both down quite sharply. Anglo American [JSE:AGL] lost 6.94% to R147.50 and BHP Billiton [JSE:BIL] traded 2.58% softer on R189.97.
In the industrial sector SABMiller [JSE:SAB] gained 2.06% to R886.29 and Richemont 1.12% to R95.70, but Naspers [JSE:NPN] traded 2.73% softer on R1 899.89
Sasol [JSE:SOL] was also a victim of the strong rand as the share price dropped 4.25% to R444.64, despite the oil price climbing to $46 per barrel, its highest level this year. Sasol is however still more than 23% higher over the past three months.
FirstRand [JSE:FSR] gave up 3.39% to R44.20 in brisk trade, while Standard Bank [JSE:SBK] lost 2.45% to R124.59.
