The JSE stayed weaker at noon on Wednesday, tracking its European counterparts, which reacted negatively to Portugal's downgrade last night.
But gold stocks have shone thus far, encouraged by the yellow metals, an equity dealer said, adding that “it's about time they see a bounce”.
By 12:02 local time, the JSE all-share index was down 0.18%, with banks falling 0.69%, financials dropping 0.50% and industrials shedding 0.31%. Platinum miners also lost 0.41%, but resources were marginally up, 0.09%, and gold miners climbed 2.40%.
The rand was bid at 6.74 to the dollar, from 6.70 to the dollar at the JSE's close on Tuesday. Gold was quoted at US$1,516.53 a troy ounce from US$1,508.75/oz at the JSE's previous close, while platinum was at $1,739/oz, from $1,737/oz previously.
The markets did not take the news on Portugal's downgrade well, the equity dealer said. Moody's downgraded Portugal's credit rating late yesterday, putting European markets under pressure.
Dow Jones Newswires reported that European stocks were lower on Wednesday, with bank stocks under pressure on renewed worries about the sector's exposure to sovereign debt after Moody's downgraded Portugal's credit rating.
London's FTSE 100 was down 0.5% at 5,996.87, Frankfurt's DAX slipped 0.2% to 7,426.37 and Paris's CAC-40 was 0.4% lower at 3,962.22.
Late on Tuesday, Moody's Investors Service cut Portugal's sovereign debt rating by four notches to “Ba2” - two levels into “junk” territory - and put the country on “negative” watch, meaning further downgrades are possible. Moody's also said it expected Portugal to need a second bailout.
In Asia, stock markets were mixed on Wednesday, with Hong Kong-listed China banks falling on news Singapore's Temasek Holdings raised $3.62 billion by selling down its stakes in Bank of China and China Construction Bank Corp.
Japan's Nikkei Stock Average rose 0.2%, and Hong Kong's Hang Seng Index lost 0.4%.
On the JSE, Anglo American (AGL) fell 1.55 rand to 336.70 rand and Sasol (SOL) lost 2.00 rand to 358.00 rand. But BHP Billiton (BIL) rose 50 cents to 267.00 rand, but
Gold miner AngloGold Ashanti (ANG) jumped 5.90 rand or 2.11% to 285.25 rand, Gold Fields (GFI) advanced 2.82 rand or 2.91% to 99.82 rand and Harmony (HAR) gained 1.98 rand or 2.30% to 87.98 rand.
Platinum producer Impala Platinum (IMP) eased 1.19 rand to 179.81 rand, but Eastern Platinum (EPS) rallied 20 cents or 3.51% to 5.90 rand.
Elsewhere, Coal of Africa (CZA) rocketed 1.66 rand or 20.52% to 9.75 rand. The company said it had been granted environmental authorisation for its Vele colliery by the Department of Environmental Affairs with effect from July 5, the company said on Wednesday.
“As expected, the authorisation contains specific conditions the company will be required to fulfil due to the uniqueness of the area,” the company added. The construction phase at Vele was expected to be completed within six to nine months from the restart date and would ultimately ramp up to an initial production profile of one million tons a year.
In the industrial sector, Bidvest (BVT) surged 4.95 rand or 3.20% to 159.49 rand, while Tigerbrands (TBS) dropped 3.18 rand or 1.56% to 200.25
Banking group Investec Ltd (INL) was down 76 cents or 1.32% to 56.60 rand.
Construction group Aveng (AEG) slid 58 cents or 1.57% to 36.30 rand.
Retailer Pick n Pay (PIK) gave up 60 cents or 1.43% to 41.26 rand. Pick n Pay announced on Wednesday that due to operational requirements it was contemplating the retrenchment of about 3,137 workers within its non-management bargaining unit.
Pick n Pay operations director Neal Quirk said that the decision had been taken after a great deal of thought over a period of time and was in line with the major problem facing the company in respect of declining profitability and the loss of market share.
Lewis (LEW) slipped 1.21 rand or 1.38% to 86.79 rand and Truworths (TRU) lost 1.23 rand or 1.64% to 73.57 rand.
Bauba Platinum (BAU) plunged 10 cents or 5% to 1.90 rand. The platinum exploration company announced that it had raised 50 million rand by issuing shares. The company said it had raised the funds by issuing about 27.8 million ordinary shares for cash to fund key exploration projects on the Eastern Limb of the Bushveld.
Bauba holds rights over eight properties on the Eastern Limb of the Bushveld Complex. The company has plans to establish a mine producing an initial 350,000 ounces of platinum group metals a year. - I-Net Bridge