JSE hit by weaker retail and mining

THE JSE acted largely out of step with its global counterparts yesterday, settling somewhat lower after an initial positive opening.

Losses were spread across most sectors, but diversified miners took the biggest hit thanks to weaker commodity prices resulting from a relatively strong dollar.

The resources index, which includes big mining companies like Anglo American and BHP Billiton, dropped 2.72%, while gold miners shed 2.28%.

The weakness came even as companies within the sector continued to post good financial results, with Assore more than doubling its first-half headline earnings and Pan African Resources declaring a record R300-million total dividend payment in its interim results.

This followed in the footsteps of AngloGold Ashanti, which said on Tuesday it was reinstating a dividend for the first time in three years, as the world’s third-largest gold producer improved its cash flow.

Outside the resource market, banks slipped for a fifth consecutive session, which analysts attributed to poor sentiment following the discovery of collusion and price-fixing allegations involving rand trades by some domestic and international banks.

Business Day reported that a fine of R69.5-million imposed on Citibank represented 4% of turnover, not the 10% of annual turnover previously stated.

However, the commission warned that it would go for maximum penalties if banks did not come forward early to cooperate.

The weakness in resources and banks left the allshare index down 0.95% at 52 088.6 points by the close, with the top 40 losing 1.06%.

B P Bernstein trader Vasilis Girasis said: “From a technical point of view our Alsi has come up against some overhead resistance. It looks as though we might see some consolidation going forward before a break to either the up- or downside.”

Anglo American was off 3.75% at R211.71 and BHP Billiton 3.13% to R221.89. AngloGold Ashanti shed 4.39% to R157.79. Woolworths dropped 2.06% to R69.54 and Shoprite 1.4% to R191.89.