Johannesburg – The market tone on the JSE was distinctly weaker on Friday after some profit taking the previous day turned the momentum around.
The market weakness was worsened by the uncertainty worldwide as the markets await the latest US jobs data due later on Friday.
Expectations are that the data will indicate that the US economy is strong enough for the Federal Reserve to make a move on US interest rates later this year.
The dollar benefited from this, which is not only bad news for the rand which traded as low as R13.90/$, but also for the lacklustre commodities market. Resources shares took the brunt of the losses and the Resources index was 4.08% lower by midday after losing more than 5% the previous day.
READ: Rand softer as market eyes US jobs data
The All Share-index was 2.04% lower on 52 968 points and the Top 40-index lost 2.2% to 47 484 points.
The Financial index traded 1.8% weaker and the Industrial index lost 1.86% after Richemont’s [JSE:CFR]share price was trashed following disappointing results. The Gold index was 1.71% lower.
The two biggest commodity shares on the JSE, BHP Billiton [JSE:BIL] and Anglo American [JSE:AGL], were both sharply lower. BHP Billiton, which was steadier than other commodity shares lately, lost 5.47% to trade at R209.46. The share’s 52-week low of R204.88 is now within sight.
Anglo American set a new 52-week low of R112.97, just 2c lower than the previous low of R112.99, after the share price shed 1.66%.
Lonmin’s [JSE:LON] share price, which lost almost 14% over the previous seven days, went into free fall this morning and lost 16.43% to only R3.56. Investors are now concerned that the rights issue of more than R5bn might not be enough to save the company from the effects of the low platinum price.
Arcelor Mittal [JSE:ACL], South Africa’s biggest steel producer, lost 6.25% to a 52-week low of R7.36 on the news that it plans to raise as much as R4.5bn in a rights offer to reduce debt and invest in plants as the company said its 2015 loss will be 11 times bigger than last year’s.
READ: ArcelorMittal SA to sell more stock than it’s worth
ArcelorMittal, which holds 46.8% of the company, will fully underwrite the offer, the local unit said in an statement on Friday. It owes the parent R3.2bn in loans and the fundraising exceeds the company’s current market value of R3.47bn.
Richemont’s share price dropped 8.31% to R110.45 after the share price closed last night just below its 52-week high. The owner of the Cartier and Montblanc brands, forecast a challenging second half and reported first-half earnings that trailed analyst estimates amid weak demand for watches.
MTN [JSE:MTN] lost another 1.96% to R158.82 and is now more than 30% lower over the past 90 days.
Naspers [JSE:NPN] bucked the downtrend and was trading at a new high of R2 089.00.
