JSE wrap: Panic sets in as markets head deeper into the red

The rout in the stock market deepened on Thursday over worsening fears over the spread of the coronavirus.

Tensions were heightened by the Donald Trump’s decision to suspend travel from European countries except for the United Kingdom. With increasing cases of infections of infections and deaths due to the virus in Italy, there is a huge concern over the ability of different countries to decisively manage and contain the spread of the virus. Panic set in as markets slipped further into the red with the deep losses being recorded from Asia, Europe as well as the USA.

Local manufacturing and mining production data for the month of January came in better than expected but global sentiment weighed more on the all-share index. Manufacturing production YoY contracted 2% from a prior recording of -5.9%, while manufacturing production MoM rose 2.5% compared to forecast of -1.7%. Mining production YoY advanced 7.5% from a prior recording of 0.1%, while mining production MoM rose 6% from a compared to a forecast of 0.9%.

Emerging market currencies continued to reel as investors took flight to safe haven currencies. The rand was not spared as it fell as low as R16.54/$ before it was recorded trading 1.8% lower at R16.49/$ at 17.00 CAT.

The magnitude of today’s decline is highlighted by the number of double-digit percentage declines across most blue-chip stocks. Sasol [JSE:SOL] plummeted deeper into the red in today’s session as it reached a low R28.67 before it closed 29.36% lower at R37.24. Constituents of the resources index led most of the day’s declines as losses were recorded for Northam Platinum [JSE:NHM] which lost 23.36% to close at R86.00, Sibanye Stillwater [JSE:SSW] which plummeted 22.6% to close at R23.70, as well as African Rainbow Minerals [JSE:ARI] which closed at R92.01 after falling 20.32.

Losses were also recorded for Intu Properties [JSE:ITU] which lost 20.17% to close at R0.95, as well as Massmart [JSE:MSM] which plunged 11.7% to close at R35.71.

The JSE All-Share index eventually closed 9.72% weaker while the JSE Top-40 index lost 9.92%. The Resources index plummeted 14.43%, while the Financials and Industrials indices lost 6.37% and 8.72% respectively.

Brent crude slipped further in today’s session as it was recorded trading 6.23% lower at $33.56/barrel just after the JSE close.

At 17.00 CAT, Gold was down 3.12% at $1584.26/Oz, Platinum had lost 8.66% to trade at $789.22/Oz, and Palladium had 13.49% lower at $200.49/Oz.