Johannesburg - The JSE was awash in red on Wednesday led by BHP
Billiton, which declined 3.3% amid speculation that it may raise its offer
for Potash Corporation of Saskatchewan, while banks gave up 2.45% amid outlook
its close the JSE all share index had fallen 1.42%, with resources moving down 1.58%
while gold miners shed 1.14%. Platinum miners declined 0.84%, banks fell
2.45%, financials were 1.65% lower and industrials lost 1.17%.
The rand was bid at R7.26 to the dollar from R7.24 at the JSE's close on Tuesday. Gold was
quoted at $1 221.49 a troy ounce from $1 226.13/oz at the JSE's previous
close, while platinum was at $1 527.50/oz from $1 544.50/oz before.
local dealer said: "Billiton is still under pressure amid talk that it has gone hostile and
may approach Potash's shareholders to raise its offer for the group."
One other trader noted that banks were under pressure, particularly Standard Bank Group [JSE:SBK]
as results in recent times pointed to outlook uncertainty and a
growing concern about the pace of the local economic recovery.
Dow Jones Newswires reported that US stocks slipped into the red as investors took a
breather from Tuesday's strong rally, reacting tepidly to the last trickle of
second-quarter earnings and developments on the deals front.
The Dow Jones Industrial Average fell 44 points to 10 361 in early trading.
Potash Corp of Saskatchewan remained in the spotlight after mining giant BHP Billiton [JSE:BIL]
decided to bypass Potash's board and go directly to its shareholders with a
hostile bid. BHP is hoping an unchanged offer price of $130 a share in cash
can do the trick, even after the Potash board described the bid as
BHP's Sydney-listed shares fell 4.4%, leading the Australian stock market to finish in
the red. Potash shares rose 2.8% in the US, while BHP's New York-listed
shares fell 2.8%.
Investors took a more cautious view of the markets after a strong showing on Tuesday,
gaining more than 1% to break a five-session losing streak.
"The big rally from yesterday is still being digested," said Ralph Fogel, investment
strategist with Fogel Neale Partners. "The market has come back to an area of
support and is hanging around here, which is reasonably healthy after a rally
Asian stocks ended mixed Wednesday as some investors stayed on the sidelines amid a lack
of trading cues.
Japan's Nikkei Stock Average gained 0.9%, South Korea's Kospi added 0.4%. Hong Kong's
Hang Seng Index fell 0.5%, and the Shanghai Composite Index slipped 0.2%.