Fin24

JSE down on lower commodity prices

2012-11-28 18:40

Johannesburg — Mining and resources stocks lost ground due to lower commodity prices on Wednesday‚ dragging the JSE lower‚ in line with global markets‚ as a lack of progress on the US fiscal cliff issue and concerns about the long-term Greek debt problem‚ weighed on global investor sentiment.

At 17:00‚ the All Share [JSE:J203] index was down 0.97% to 37 438.41 points‚ with the Top 40 - (Tradeable) [JSE:J200] index dropping 1.06%.

The platinum and bullion indices gave up 2.85% and 2.63% respectively.

Leading European markets lost ground due to cliff worries‚ with the FTSE 100 last seen 0.55% softer‚ and the Paris CAC 40 index slipping 0.42%. At 16:46 local time the Dow Jones Industrial Average was 0.47% weaker following two days of declines.

“The JSE All Share index has experienced a broad-based sell-off today in line with weaker US markets overnight and softer Asian markets this morning. The US senate majority leader Harry Reid’s comments relating to there being hardly any progress towards a fiscal cliff resolution have revitalised recessionary fears in markets as we approach the end of year deadline‚” said Shaun Murison‚ market analyst at IG Markets.

“Markets are now hugely correlated to the fiscal policy outlook‚ perhaps amplified on days like today where the economic calendar is particularly light‚” he said.

“Gold and platinum counters have been hit hard today. Resources shares are currently exaggerating weaker commodity prices‚ as a stronger dollar and a nervous demand outlook is currently causing today’s retracement in metal prices‚” he added.