JSE ends softer on declines in gold and resources

THE JSE closed the Tuesday session softer as market participants took profit in the resources and gold mining sectors after good recent gains and following a minor sell-off in these sectors in Australia today‚ which filtered through to the local bourse.

At 5pm‚ the all share index closed 0.1% lower at 46‚889.64 points and the top 40 index was 0.11% softer.

The gold mining index led declines‚ shedding 3.85%‚ followed by resources down 1.41% after rises over the past few days that were underpinned by a weak rand.

Retailers regained some strength after some losses over the last week or so‚ with the food retail index ending 0.92% firmer and general retailers up 0.75%.

“A minor sell-off of resources and miners in Australia on the back of weaker commodity prices put pressure on our miners and pushed our resource sector lower. The announcements of local strikes added pressure to our resources‚” Investec Asset Management equity dealer Kagiso Matlala said.

“Retailers have bounced back after being sold off the last couple of days after some negative trading updates last week. They have now come back a bit after selling has been a bit overdone‚” he said.

Meanwhile, US stocks rose‚ as the Chinese central bank’s injection of funds into money markets and some positive corporate news helped put investors returning from a long holiday weekend in an upbeat mood‚ Dow Jones Newswires reported.

At 5pm local time‚ the Dow Jones industrial average was up 0.14% at 16‚476.42 points. The stock market was closed on Monday for Martin Luther King Junior Day.

The People’s Bank of China injected liquidity into the banking system after short-term borrowing costs leapt as demand for cash increased ahead of the Lunar New Year holiday‚ helping ease concern over a credit crunch‚ the news service said.

Among individual shares on the JSE, Anglo American shed 2.74% to R241.84 and rival BHP Billiton ended 1.95% lower at R331.20, while Sasol gained 1.33% to R545 on a firmer oil price.

Kumba Iron Ore lost 3.25% to R446.

AngloGold Ashanti led declines in the gold space, falling 4.77% to R144, followed by Harmony Gold, down 3.36% to R29.87. Gold Fields gave back 3.2% to R36.25 despite a positive production and cost trading update on Tuesday.

Gold Fields’ attributable group production for the fourth quarter ended December 2013 is expected to be about 598‚000 gold-equivalent ounces‚ which is 21% higher than the 496‚000 ounces achieved in the September 2013 quarter (third quarter)‚ the gold miner said.

Among platinum counters, Anglo American Platinum gained 2.21% to R417.65, as looming strikes could disrupt supplies, while Lonmin bucked the trend, shedding 3.25% to R56.

Northam Platinum lifted 2.07% to R44.91 after management confirmed late on Tuesday that the strike at the company’s Zondereinde mine had ended, and a two-year wage agreement had been reached.

Global brewer SABMiller closed 0.14% firmer at R549.68 after it released a trading update on Tuesday stating total beverage volumes grew by 2% for the third quarter on an organic basis‚ with lager volumes up 1% and soft drink volumes up 7%.

Electronics group Ellies Holdings closed 2.52% higher at R6.10, despite announcing a 41% drop in interim profit, which the company ascribed to the ending of a contract with Eskom.

Among retailers, Woolworths rose 1.3% to R69.49, Shoprite added 1.04% to R150 and Spar gained 1.85% to R123.75.

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