JSE lower on profit taking

EQUITIES ended in the red yesterday, amid profit taking and consolidation after three days of strong gains.

The JSE also followed world markets lower on concerns that the US Federal Reserve may begin pulling back on its bondbuying programme.

This would lead to a withdrawal of support for equity markets as excess cheap money that has to be parked somewhere would diminish.

At 5pm, the JSE all share index closed 1.76% lower at 41,233.07 points, with the top 40 blue-chip index losing 1.89% to 36,739.42 points.

A drop in local financial, industrial and banking counters offset gains in platinums and golds.

Financials dropped 2.55%, industrials gave back 2.16% and banks gave away 1.97%.

Gold miners and platinums added 0.61% and 0.78%, respectively.

“Life insurer MMI was down a lot today (yesterday) with quite a lot of negativity seen in the insurance sector,” said Nerina Visser, head of Beta Solutions at Nedbank Capital.

“Rand hedge industrials and rand hedge financial shares had a particularly good run in the last couple of weeks, but shed value today (yesterday) in a weaker rand environment.”

“The rand year-to-date on a trade weighted basis has lost 13.5%, and half of the losses happened in May. The Japanese yen however has weakened 33% this year alone,” she said.

Among individual shares on the JSE‚ BHP Billiton (BIL) dipped 0.38% to R284.31, while oil giant Saso l (SOL) gave back 1.67% to R441.

ArcelorMitta l (ACL) surged 4.20% to R26.05 and Kumba Iron Ore (KIO) rose 1.28% to R519.40.

Rand hedge counters British American Tobacco (BTI) shed 3.06% to R541.24 and luxury goods company Compagnie Richemont (CFR) dropped 3.47% to R89.30.

Gold Fields (GFI) gained 1.97% to R56.40, while Gold One International (GDO) bucked the trend, slumping 7% to R1.86. Anglo American Platinum (Amplats) picked up 1.02% to R298 and Lonmin (LON) rose 3.25% to R40.02.

Life insurer MMI Holdings (MMI) slumped 9.16% to R24.01 after issuing a March quarterly update, saying total group new business for the quarter increased 11% compared with the corresponding figure of the prior year.

Short-term insurer Santam (SNT) slipped 2.11% to R186 after saying it had experienced tough underwriting conditions in the first four months of the year. Financial services group Discovery (DSY) shed 4.71% to R79.90. Staff Writer