The JSE was weaker at midday on Thursday as anxious investors fled equities to the relative safety of government bonds in developed markets.
In a week that had been expected to be calm‚ with China’s stock markets closed for the Lunar New Year and no central bank action in focus‚ stocks have fallen out of favour as investors worry about the state of the global economy.
The CBOE Volatility Index‚ which has emerged since the 2008 financial crisis as one of the world’s most important reflections of investor sentiment‚ has spiked 11.21% over the past day.
Standard Bank analysts said the rout in global stock markets had been sparked by concerns over the health of the European financial sector.
“Attention will (now) turn to (US Federal Reserve chairwoman) Janet Yellen’s testimony in front of Congress’s Financial Services Committee. The market is clearly not expecting Ms Yellen’s testimony to be hawkish. With the market so convinced that there will be no hikes by the Fed during the first half of 2016‚ the surprise for market prices may be a Fed more hawkish than expected‚” the analysts said.
Ms Yellen will speak on Wednesday and Thursday. The Fed will meet again in March.
At 12pm‚ the all share was down 0.99% to 48‚941 points and the blue-chip top 40 index had shed 1.07%.
The gold index added 1.15% as investors sought safe-haven assets. Industrials‚ financials and banks were down 1.13%‚ 0.95% and 0.21% respectively. Platinums gave back 0.37% and resources were 0.75% weaker.
The spot price of gold was flat at $1‚189.80.
European stock markets were mostly lower.
By noon (CAT)‚ the French CAC 40 and the German DAX 30 had lost 0.40% and 0.30%. The UK’s FTSE 100 was up 0.48%.
Among individual shares on the JSE‚ Bidvest saw its share price fall 1.59% to R356.98.
Harmony Gold rose 1.83% to R40.53 while Sibanye climbed 1.33% to R46.56.
Insurer Santam was up 1.91% to R183.95.
Diversified internet company Naspers tumbled 3.65% to R1‚782.46.
Illovo Sugar rallied 3.23% to R20.80. Tuesday marks the second day of solid gains for the company after its UK principal‚ Associated British Foods proposed to buy out minority shareholders and delist it from the JSE.
ABF‚ a diversified food and retail group‚ owns 51.35% in Illovo and has been invested in it for 10 years. It is the 22nd-biggest company on the London Stock Exchange’s FTSE 100.
Shares on the JSE dragged down by antsy investors
The JSE was weaker at midday on Thursday as anxious investors fled equities to the relative safety of government bonds in developed markets.
In a week that had been expected to be calm‚ with China’s stock markets closed for the Lunar New Year and no central bank action in focus‚ stocks have fallen out of favour as investors worry about the state of the global economy.
The CBOE Volatility Index‚ which has emerged since the 2008 financial crisis as one of the world’s most important reflections of investor sentiment‚ has spiked 11.21% over the past day.
Standard Bank analysts said the rout in global stock markets had been sparked by concerns over the health of the European financial sector.
“Attention will (now) turn to (US Federal Reserve chairwoman) Janet Yellen’s testimony in front of Congress’s Financial Services Committee. The market is clearly not expecting Ms Yellen’s testimony to be hawkish. With the market so convinced that there will be no hikes by the Fed during the first half of 2016‚ the surprise for market prices may be a Fed more hawkish than expected‚” the analysts said.
Ms Yellen will speak on Wednesday and Thursday. The Fed will meet again in March.
At 12pm‚ the all share was down 0.99% to 48‚941 points and the blue-chip top 40 index had shed 1.07%.
The gold index added 1.15% as investors sought safe-haven assets. Industrials‚ financials and banks were down 1.13%‚ 0.95% and 0.21% respectively. Platinums gave back 0.37% and resources were 0.75% weaker.
The spot price of gold was flat at $1‚189.80.
European stock markets were mostly lower.
By noon (CAT)‚ the French CAC 40 and the German DAX 30 had lost 0.40% and 0.30%. The UK’s FTSE 100 was up 0.48%.
Among individual shares on the JSE‚ Bidvest saw its share price fall 1.59% to R356.98.
Harmony Gold rose 1.83% to R40.53 while Sibanye climbed 1.33% to R46.56.
Insurer Santam was up 1.91% to R183.95.
Diversified internet company Naspers tumbled 3.65% to R1‚782.46.
Illovo Sugar rallied 3.23% to R20.80. Tuesday marks the second day of solid gains for the company after its UK principal‚ Associated British Foods proposed to buy out minority shareholders and delist it from the JSE.
ABF‚ a diversified food and retail group‚ owns 51.35% in Illovo and has been invested in it for 10 years. It is the 22nd-biggest company on the London Stock Exchange’s FTSE 100.
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