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Johannesburg - Share prices on the JSE drifted lower on Wednesday morning as the major indices seem unable to breach important resistance levels, adding to selling pressure.
The All-share index opened marginally higher, but the tendency for the rest of the morning was a slow descent and by midday the index was just in the red. At that stage it was 0.19% softer at 51 718 points, while the Top 40 index had lost 0.12% to 51 718 points.
The market was dragged lower by the Resources index, still hampered by the solid dollar supported by stronger-than-expected US growth figures. At midday the Resources index had lost 2.05% after it was announced that the US gross national product for the third quarter was revised upwards from 1.5% to 2.1%.
This suggests that the economy is resilient enough to give the Federal Reserve confidence to raise interest rates next month. Gold and platinum prices were both down on Wednesday morning,
The rand was however remarkably stable at R14.09 to the dollar, which enabled financial shares to hold their own. By midday the Financial index was 0.06% in the black.
The Industrial index was 0.08% lower as European markets lost confidence on fears of geopolitical problems after a Russian fighter plane was shot down by Turkey on Tuesday.
Anglo American [JSE:AGL] was again one of the biggest losers in the resources sector. The share price reached a new 52-week low of R89.26 at midday on Wednesday, 6.49% lower than the previous day’s close.
Anglo American has performed miserably over the last 30 days and lost 31.4% of its value, which means the share price is already 55.67% lower for the year to date.
BHP Billiton [JSE:BIL] also lost 1.32% to a new low of R183.41 and is now 21.7% lower over the past 30 days. Its ability to pay a dividend despite low commodity prices won favour with investors and limited the damage somewhat.
The other commodity giant on the JSE, Glencore [JSE:GLN], which has lost more than 57% of its value over the past three months, was another 0.85% down to R19.75. The share price still has some way to go before it reaches the 52-week low of R15.41.
Lonmin [JSE:LON] continued to be one of the busiest shares on the JSE, as investors off-load shares before the rights offer close with more than 7 million shares being sold in 288 transactions.
In the gold sector, which was virtually unchanged by midday on Wednesday, Harmony [JSE:HAR] became the victim of profit-taking after the share price gained more than 10% on Tuesday on the news of a gold find in Papua New Guinea which could lead to a new gold mine in that region.
By midday the share price was 3.19% lower at R8.79 and the share is now more than 27% lower over the past 30 days.
The company announced on Tuesday that the Kili Teke site has a resource of 1.2 million ounces of gold, 506 000 tons of copper and 22 000 tons of molybdenum, used in making steel.
Among the three busiest shares in terms of volume in the Industrial index, British American Tobacco (BAT) [JSE:BTI] was the top performer with gains of 1.34% to trade at R822. 56. Steinhoff [JSE:SHF] was 0.72% down at R80.96 and Naspers [JSE:NPN] lost only 0.06% R2 202.53.
Altron’s [JSE:AEL] woes continued and the share price lost another 6.7% on Wednesday morning to trade at a new low of only R4.85 by midday.
Investors do not seem to have too much confidence in Altron’s efforts to stop the company’s sharp drop in income and it lost 56.7% of its value over the past 90 days. Altron is finalising the disposal of Powertech Transformers and the Altech Autopage subscriber base. Autopage is reeling from reduced mobile termination rates.
In the financial sector, Brait [JSE:BAT] reached yet another high of R163.72 which is 1.13% higher than the previous day’s close. The company, which made some acquisitions in Britain lately, is the best performing share on the JSE and is already 105.69% higher for the year to date.
