JSE languishes on profit-taking

Johannesburg - South African stocks extended their losses by noon on Thursday as traders took profits in the wake of suffering global markets.

Asian markets were lower earlier after Wall Street lost more than 5% overnight.

By 11:56 the JSE's all index had fallen 2.78% weighed down by resources which tumbled 4.34%, platinum stocks which shed 3.10% and gold miners which gave up 1.49%. Banks slipped 2.56%, financials lost 1.52% and industrials gave up 1.80%.

The rand was bid at R9.86 to the dollar from R9.65 when the JSE closed on Wednesday, while gold was last quoted at $741.75 a troy ounce from $755.65/oz at the JSE's last close.

The platinum price was at $865/oz; edging up 0.41% from its previous close of $861.50/oz and Brent crude was at $61.50 from its close of $61.87.

"There is profit taking on the back of the recent rallies. Sanity is coming back into the market," a local equities trader said.

"Markets are realising that the problem is still there and it needs to be dealt with," he added.

Dow Jones Newswires reports that European stocks dropped sharply on Thursday on renewed global recession worries and ahead of key interest rate decisions from the Bank of England and the European Central Bank.

Shares in London fell sharply across the board ahead of a widely expected interest rate cut from the Bank of England. The market-wide declines came after US stocks closed sharply lower on Wednesday as economic worries overshadowed the election of President-elect Barack Obama.

The FTSE 100 was last down 4.26%.

Asian markets also tumbled amid global economic worries, with China's main stock index dropping to a level it hasn't seen in more than two years, while benchmarks in Japan and Hong Kong slumped more than 5%.

- I-Net Bridge