JSE closes lower as resources drag
THE JSE closed lower on Wednesday with heavy-weighted resources and gold counters placing most of the drag on the local bourse.
Profit taking was also abuonded in afternoon trade on Wednesday after the JSE reached highs on Tuesday.
Markets were now awaiting the release of the minutes from the US Federal Reserve’s latest policy-setting committee meeting, due at 8pm local time on Wednesday.
Traders will look out for clues on how close the US Fed was to providing additional monetary stimulus.
At 5pm local time, the all-share index was down 0.6% at 35,616.71 points, with resources down 1.25% and gold counters shedding 0.82%.
International markets slipped, with Asian markets closing weaker and the UK FTSE last seen trading 1.24% lower.
The platinum price extended its previous gains to R1,517.50 per ounce, partly due to platinum miner Lonmin not having resumed production on Wednesday.
Lonmin’s woes have also spread to other platinum miners in South Africa.
Clashes between police and striking mine workers left 34 dead at Lonmin’s Marikana mine in Rustenburg last Thursday.
At least 500 workers of the Royal Bafokeng Platinum mine outside Rustenburg staged a protest on Wednesday‚ demanding across-the-board salaries of R12‚500 per month.
The counter closed unchanged at R47.
Amplats workers also demanded higher wages on Wednesday, after Impala Platinum Holdings and Aquarius Platinum workers had done the same.
Market participants were concerned that platinum supplies from South Africa would be further negatively affected, with the country supplying about 80% of world platinum.
Lonmin closed R3.03‚ or 3.66%‚ lower at R79.80.
The Association of Mineworkers and Construction (Amcu) leader, Joseph Mathunjwa, on Wednesday said the union — which was leading the illegal strike at Lonmin — had not been able to meet management to discuss the strike.
Elsewhere, a major decline in Japanese trade was reflected in figures released on Wednesday, with trade between Japan and China dropping significantly.
"Chinese demand has dipped which is more bad news for our commodities, as prices are likely to fall," said Drikus Combrinck, portfolio manager at PSG Konsult, in Pretoria.
"There was some profit taking today after a good couple of trading days," he added.
"We need more solid action from the European Central Bank and more substance with regards to their buying of Spanish and Italian bonds in future.
"Good US jobless claims and home sales figures out tomorrow are also needed. We need some positive surprises to give the market direction," he added.
In other international news, US stocks opened a tad lower, trailing losses in Asia and Europe, amid investor jitters over coming meetings between Greek and eurozone leaders, and ahead of the release of minutes to the latest Federal Reserve policy meeting.
At 4.46pm local time, the Dow Jones Industrial Average had slipped 27 points, to 13,176.22 points.
Investors were awaiting talks between Greek Prime Minister Antonis Samaras and eurozone leaders this week.
Mfr Samaras was expected to ask for more time to meet austerity measures required for the country to receive bailout funds.
He was expected to meet with Eurogroup chief Jean-Claude Juncker on Wendesday, German Chancellor Angela Merkel on Friday and French President Francois Hollande on Saturday, Dow Jones Newswires reported.
Local shares that drew attention were Anglo American, which shed R6.52 or 2.53%, at R250.86 and BHP Billiton, which lost R2.35 to R254.85
BHP reported on Wednesday basic earnings per share of 289.6 US cents for the year ended June 2012‚ down 32.5% from 429.1 US cents a year ago.
Massmart closed 50c softer at R169.50. The retailer reported a 34.4% rise in diluted headline earnings per share to 552.3c for the 52 weeks ended June 24 from 410.8c a year ago.
Imperial closed R3.33, or 1.72%, stronger at R197.43 after reporting a 14% rise in headline earnings per share to 1‚566c for the year ended June.
Freight company Grindrod jumped 90c, or 6.62%, to R14.50, after the company reported a 25% increase in headline earnings per share to 69.4c for the six months ended June 2012 from 55.7c a year ago.
Manufacturer‚ recycler and distributor of plastic and paper packaging products‚ Transpaco‚ closed 95c, or 5.78%, lower at R15.50 after reporting an increase in diluted headline earnings per share to 201.1c from 2011’s 195.7c.
Shares in 1time dropped 7c, or 50%, to close at 7c. The no-frills airline operator announced late on Tuesday it was applying for business rescue due to financial distress at its subsidiary companies.
Business support services group Mvelaserve shed 35c, or 4.09%, to R8.20, after the company said on Wednesday it expected its headline earnings per share in the year ended June 2012 to decline to between 60c and 70c‚ compared with 159.8c in the same period a year ago.
Health insurer Discovery Holdings shed R1.11, or 1.89%, to R57.59. The company said on Wednesday it expected its normalised headline earnings per share in the year ended June 2012 to between 10% and 20% higher than in the same period a year earlier.
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