Analysts say global investors who bet on a quick end to the war in Iraq may begin to take profits despite a technology rally in the US on Friday, as US-led coalition forces meet resistance.
Global exchanges rallied last week after the coalition began strikes on Baghdad, ending weeks of uncertainty that held international markets in a state of limbo.
Indices worldwide, led mainly by blue chips and technology stocks, climbed as investors rushed to buy stocks in the hope of a market recovery after a quick resolution to the conflict.
However, the picture was markedly gloomier this morning as Iraqi resistance mounted. Analysts say there are indications that the war may take longer than the US had initially hoped and that Iraqi resistance, as well as a high US casualty rate at Nasiriyah, may lead investors to take advantage of last week`s rally by taking profits.
The JSE`s all share index was up 43 points or 0.53% at 8 182 by midmorning today. Dealers say the market took heart at Friday`s gains overseas, but that weak US futures this morning dampened enthusiasm.
The IT index was in the red again, down 73.94 points or 2.13% at 3 401.09. IT hardware was down 1.67 points at 207.63 and software and computer services was down 1.74 points at 69.8.
Among the biggest losers were Dimension Data, which lost 7c or 3.55% to 190c; Datatec, down 10c or 2.38% to 410c; and Mustek, down 15c or 3.26%.
Markets in Europe also gave up ground. By midmorning the UK`s FTSE 100 had lost 61.5 points or 1.59% to 3 799.6, Germany`s Dax had given up 75.93 points or 2.8% to 2 639.14 and the CAC40 in France was 65.96 or 2.28% down at 2 824.72.
In Japan the Nikkei was up 5.4% at 8 435.08, but Hong Kong`s Hang Seng was 0.59% lower at 9 125.41.
South African markets were closed on Friday due to the Human Rights Day public holiday, when US investors continued to express confidence in a quick war.
The technology-heavy Nasdaq composite index rose 19.07 points or 1.36% to 1 421.84, while the Dow Jones industrial average climbed 235.70 points or 2.84% to 8 521.97. The broader S&P 500 index rose 20.06 points or 2.30% to 895.90.
Analysts say stocks were boosted by continued hopes of a speedy coalition victory as well as news that the US forces had gained control of several oil fields.
On the local front, the market was under pressure on Thursday from a profit warning from Richemont, the futures closeout, rand strength and local sentiment about the war.
The overall information technology index lost 40 points or 1.15% to 3 475.03. IT hardware rose seven points or 3.64% to 209.3 while software and computer services lost a point or 2.17% to 71.54.
The all share index closed 153 points or 1.85% down at 8 139.
Related stories:
Stocks firm as war looms
Share
