JSE closes lower on profit taking

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The JSE. Photo: Simphiwe Mbokazi.

The JSE ended lower on Tuesday‚ after reaching an all-time high on Monday‚ with no major external factors driving the market‚ except for some risk-off profit taking by investors ahead of big international policy announcements on Wednesday and Thursday.

“We have seen some end-of-month locking in of profits today after yesterday’s high. I am not surprised that we have come down and there was a fair bit of selling in the banking space today. We had good runs on Friday and Monday with tremendous gains‚ so today we saw some selling‚” said Ryan Wibberley‚ equity dealer at Investec Asset Management in Cape Town.

“The FTSE 100 has been flat most of the day and the US stocks opening not much of a driver. The big drivers of the market remain to play out with the Fed‚ ECB and BoE announcements on Wednesday and Thursday‚” he added.

Markets are awaiting policy announcements from the US Federal Reserve (Fed)‚ the European Central Bank (ECB) and the Bank of England (BoE) in the next two days. These announcements are expected to unveil further monetary easing measures to stimulate the US and eurozone economies. The Federal Reserve‚ which began a two-day policymaking meeting on Tuesday is scheduled to release its latest economic outlook on Wednesday afternoon and the ECB and the BoE are set to release their policy decisions on Thursday.

At 17:00 local time‚ the JSE all-share index was down 1.03% to 34‚596.90 points‚ with banks suffering the most with a drop of 2.39%.

At 16:46 local time‚ the Dow Jones Industrial Average was a tad softer‚ shedding 0.06% to 13‚064.80‚ while in London‚ the FTSE 100 was also lower‚ weighed down by heavyweight BP‚ which gave up 4.4% after releasing disappointing second-quarter results. At 17:00 local time‚ the FTSE 100 was 0.54%.

Among local big movers‚ Impala Platinum (IMP) closed R2.66‚ or 2.01%‚ lower at R130.00; Northam Platinum shed 90 cents‚ or 3.39%‚ to R25.66 and Kumba Iron Ore (KIO) lost R22.90‚ or 4.26%‚ to close at R515.10.

In industrials‚ Richemont (CFR) gave up R1.21‚ or 2.53%‚ to R46.59 and AECI (AFE) shed R3.75‚ or 4.58%‚ to R78.05.

Among counters reporting results‚ Capital and Counties (CCO) closed unchanged at R27.00 after the UK property development company reported a strong rise in profit‚ to GBP95.2m for the six months ended June 2012 from GBP68.6m a year earlier.

Sasfin Holdings (SFN) gained 15 cents to R28.85. The company said on Tuesday it had secured a term loan facility with the International Finance Corporation (IFC)‚ a member of the World Bank Group‚ and the Canadian Government’s Climate Change Programme (CCCP). The loan from the IFC amounted to R65.219 million and that from the CCCP to US$2.3 million.

Ferrochrome company Merafe Resources’ (MRF) closed unchanged at 81 cents‚ after announcing that ferrochrome production volumes in the first half of 2012 were 21% lower‚ at 118‚000 tons‚ than the 2011 comparative period’s 150‚000 tons‚ mainly due to the rescheduling of maintenance programmes and power buyback deals with Eskom‚ in a rather soft market.

SA’s third largest pharmaceutical company Cipla Medpro SA (CMP) shed 5 cents to R8.10‚ after the company said it expected its earnings per share and headline earnings per share in the six months to June 2012 to be between 32% and 38% lower compared with the same period a year ago.

In the construction sector‚ Aveng (AEG) jumped 4.62% to R36 and PPC (PPC) gained 2.90%‚ to R25.88. - I-Net Bridge


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