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The Sun King gets a licence to gild his ... Gold plummets as Switzerland jumps ship... Stals comes out smelling of rose... Stealing the show with icons of the mode... British investors give SA airship compan... |
Gold plummets as Switzerland jumps ship
FINANCIAL MARKETS
BARELY had the Johannesburg Stock Exchange (JSE) recovered from its slump on Thursday, when it was hit by news of the proposed sale of gold reserves by the Swiss central bank. Gold prices slumped to their lowest level in 12 years on Friday afternoon as selling swept the international metals market. Dealers said prices collapsed as soon as markets reacted to news that Switzerland was proposing to sell 1 400 tons of gold from its reserves sometime after 1999. Gold was trading in New York on Friday at $311.80, its lowest level since December 1985. Earlier in London it was fixed at $316.65, its lowest fixing since July 9. The slump in gold took the shine off the JSE's rebound on Friday after shares slumped by more than 4% on Thursday, wiping over R50-billion of the JSE's capitalisation. The gold index on Friday plummeted by more than 5%, with the world's biggest gold producer, Anglo American, dropping 240c to R233. Some gold mines lost up to 7% of their market value. In July bullion fell its recent lows after the Australian central bank completed the sale of 167 tons of its gold reserves. Although recovering off these lows, the metal has remained fragile. The JSE's non-mining sector recouped some of Thursday's losses but investors were still cautious of jittery global markets. The JSE's all-share index closed up 74, or 1.04%, at 7 168.3, erasing some of Thursday's 4.4% fall. The industrial index firmed 101 points, or 1.16%, to 8 783 on Friday after losing 3.9% the previous day. On international markets a rebound in Hong Kong's stock market could not convince investors worldwide that Asia's economic problems were over. Late on Friday Wall Street stocks dropped again and European markets gave up most of their early gains. In New York, the Dow Jones average, Wall Street's most watched indicator, dropped 58 points to 7 790 in early afternoon trading after jumping 92 points to start the day on enthusiasm about the turnaround in Hong Kong's market. Hong Kong on Friday recovered 7% of Thursday's 10% plunge. Stocks in London finished lower after a morning rally fizzled out in the late afternoon. The FTSE 100- closed with a loss of 21 points at 4 970 after it had peaked during the day at 5 103. On Thursday the FTSE 100 suffered its biggest one-day percentage loss in seven years.
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