JSE drops on global sentiment

The JSE leaked 160 points at its opening on Friday, tracking negative sentiment from both Asia and Europe.

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The JSE leaked 160 points at its opening on Friday, tracking negative sentiment from both Asia and Europe.

The local bourse will eye US GDP and confidence data out later, in conjunction with earnings results from Ford and Honeywell.

By 09:19 local time, the JSE all share index lost 0.50%, with resources down 0.98% and platinum miners 0.18% lower. Gold miners were 1.45% down.

Financials dipped 0.21%, banks were 0.58% lower and industrials lost 0.22%.

The rand was trading at 7.05 to the dollar, from 7.02 at the JSE's close on Thursday. Gold was quoted at US$1,313.50 a troy ounce from US$1,334.48/oz at the JSE's previous close, while platinum was at $1,772/oz from $1,810.50/oz before.

“Asia is softer after S&P cut Japans' ratings, while Europe is expected to follow suit. As has been the case during the week, the market will continue to track sentiment from abroad,” a local trader said.

“In the US, confidence data from University of Michigan along with GDP data is expected to drive sentiment,” she said.

Dow Jones Newswires reports that most Asian stock markets were lower on Friday, with shares in Japan hit by Standard & Poor's downgrade of the country's sovereign debt rating, while Samsung Electronics rose in Seoul after its earnings topped expectations.

Japan's Nikkei Stock Average was off 1.2%, South Korea's Kospi Composite was off 0.3%, Hong Kong's Hang Seng Index slipped 0.4% and China's Shanghai Composite fell 0.1%.

The Tokyo market was pressured lower by the downgrade news, with financials bearing the brunt of the selloff, while investors were also discouraged by a few downbeat earnings results.

Citing concerns over high debt levels in Japan, ratings provider S&P cut Japan's long-term credit rating to AA- from AA.

European stocks are set to open mostly lower Friday, following a lacklustre session in the US and weak Asian shares, says Chris Weston at IG Markets. He calls the FTSE 100 down 12 points at 5,953.

The continued decline in gold prices, however, which are approaching four-month lows, suggests that risk appetite is building, says Weston. On the economic calendar, euro-zone M3 is due out at 09:00 GMT, while in the US, the first release of fourth-quarter GDP is due at 13:30 GMT and University of Michigan confidence is at 14:55 GMT. On the US earnings front, Ford, Chevron and Honeywell are slated to report.

On the JSE, Anglo American (AGL) dropped 3.51 rand to 353 rand and BHP Billiton (BIL) lost 3.43 rand to 273.85 rand. Sasol (SOL) declined 2.38 rand to 350.60 rand.

Among gold miners, AngloGold Ashanti (ANG) shipped 4.41 rand or 1.41% to 307.54 rand, Gold Fields (GFI) slipped 1.65 rand or 1.45% lower to 112 rand and Harmony (HAR) wavered 1.24 rand or 1.63% to 74.91 rand.

Anglo Platinum (AMS) gave up 6.46 rand to 718.05 rand.

Kumba Iron Ore (KIO) lost 5.92 rand or 1.27% to 461.58 rand.

Diversified miner Exxaro (EXX) was 1.01 rand weaker to 147.99 rand, and African Rainbow (ARI) slipped 1.25 rand lower to 208.45 rand.

Among industrials, British American Tobacco (BTI) dropped 2.50 rand to 264 rand, and SABMiller (SAB) shed 1.95 rand to 234 rand.

Banking group Standard Bank (SBK) handed over 1.19 ran or 1.1% to 106.66 rand.

Retailer Foschini (FOS) added 1.08 rand or 1.3% to 84.21 rand. - I-Net Bridge

Source: http://www.iol.co.za/jse-drops-on-global-sentiment-1.1018239

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