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JSE weaker as global sell-off deepens

Feb 06 2018 18:22
Musa Makoni, EasyEquities

Cape Town - The JSE ended sharply lower on Tuesday as the broad based sell-off in global equities continued.

US equity markets recorded their biggest intra-day decline since December 2015 in Monday’s trading session, which saw the Dow Jones Industrial index and S&P500 index lose 4.60% and 4.10% respectively.

The sell-off persisted in Asian markets on Tuesday which also came under pressure, with the biggest loser being the Japanese Nikkei which lost 4.73%.

On the JSE, the ALSI futures opened down more than 1 800 points at 48 900 points before clawing back some of the losses to close at 49 849 points, down 731 points for the day.

The JSE Top-40 index had slightly better look on Tuesday as a couple stocks managed to trade in positive territory. Gold mining stocks opened firmer due to the higher gold prices overnight. Stocks such as Harmony Gold [JSE:HAR] and Gold Fields [JSE:GFI] gained 3.33% and 1.76% respectively.

Other positive movers on the day were Investec Limited [JSE:INL] and Investec PLC [JSE:INV] which gained 2.78% and 3.12% respectively, whilst Spur Corporation [JSE:SUR] and Growthpoint Properties [JSE:GRT] gained 3.85% and 1.50% respectively.

On the losers' side, listed property stocks continued to trade under pressure as Fortress B [JSE:FFB], Greenbay Properties [JSE:GRP] and Hammerson [JSE:HMN] lost 6.62%, 5.29% and 4.81% respectively. Mediclinic [JSE:MEI], Consolidated Infrastructure [JSE:CIL] and Adcock Ingram [JSE:AIP] shed 4.97%, 5.61% and 2.71% respectively.

Naspers [JSE:NPN] came under significant pressure due to a sell-off in Tencent Holdings on the Hang Seng. The index heavyweight broke below R3 000 per share to reach an intra-day low of R2 976.68 per share, before rebounding to close at R3 104.51 per share, down 0.5% for the day.

The JSE All-Share Index lost another 1.29% on Tuesday, whilst the Top-40 index lost 1.27%. All the major indices on the JSE were trading under pressure with the biggest loser being the Industrials index which lost 1.35%, whilst the Resources index and the Financials index lost 1.27% and 0.88% respectively.

Brent Crude traded softer as it briefly broke below $66/barrel, but it quickly pared the losses to trade at $67.28/barrel just after the JSE close. On the JSE, Sasol [JSE:SOL] lost 1.63% to close at R404.90 per share.

Gold traded firmer earlier on, but subsequently reversed all gains as the US dollar gained momentum. Gold was trading at $1 330.97/Oz just after the JSE closed, after having managed to peak at $1 346.21/Oz intra-day.

Palladium continued to lose ground as it shed more than 1.8% to reach an intra-day low of $1 008.88/Oz. It rebounded slightly to trade at $1 014.02/Oz just after the close. Platinum was mostly flat to trade at $990.77/Oz just after the JSE close.

US markets opened lower yet again with Dow Jones and S&P500 indices opening 2.18% and 1.82% lower respectively. However, an hour into the session the indices were showing signs of a potential reversal into the green.

The US 10-year Treasury bond yield was slightly lower at 2.76% at 17:30 CAT.

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naspers  |  jse  |  markets
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