The JSE Securities Exchange South Africa was roaring ahead just after noon on Thursday, fuelled by stronger world markets and a weaker rand. Softer-than-expected producer inflation (PPI) numbers added to the positive picture.
By 12h16, the all share index had strengthened 1,72%. Resources soared 2,68%, the gold mining index surged 2,23% and the platinum mining index jumped 1,35%. Industrials and financials were 1,08% and 1,15% firmer respectively, while the banks index was 1,11% better.
The rand was quoted at 6,37 per dollar from 6,25 when the JSE closed on Wednesday, while gold was quoted at $397,05 an ounce from $393.95/oz at the JSE’s last close.
“The JSE is very strong on the back of firmer world markets and the weaker rand. Anglo is really standing out — it is up over 3,5%,” a dealer said.
He added that the lower-than-expected PPI numbers were also helping.
Bargain hunting added to the upward trend on JSE which had been looking oversold after being lower for nine out of the past ten trading days.
London-listed Anglo American, the JSE’s heaviest weighted stock, rocketed 3,67% or R4,60 to R129,80. BHP Billiton leaped 2,78% or R1,45 to R53,60.
Gold Fields rallied 3,05% or R1,98 to R67, AngloGold Ashanti advanced 2,01% or R4,01 to R204 and Harmony was 1,77% or R1,16 higher at R66,66.
Impala Platinum jumped 1,52% or R6,75 to R450,01, while synthetic fuels group Sasol was 1,89% or R1,85 rand stronger at R99,50.
Swiss-listed luxury goods group Richemont surged 2,32% or 39 cents to R16,75, while investment company Remgro soared 3,03% or R2,25 to R76,50.
Richemont and Remgro put in strong showings on Wednesday on news that US anti-trust authorities on Tuesday gave approval to a merger between British American Tobacco’s US assets (Brown & Williamson) and RJ Reynolds. Richemont and Remgro own effective stakes of 18,6% and 10% respectively in BAT. The approval for the RJR-Brown & Williamson merger will pave the way for the formation of Reynolds American in the US, a force to compete with the dominant Philip Morris group in that market.
Pulp and paper producer Sappi picked up 1,62% or R1,45 to R91 and steel producer Iscor was bolstered 2,33% or 85 cents to R37,40.
On the financial front, Standard Bank was 2,02% or 85 cents stronger at R42,96.
Technology holding company VenFin firmed 1,55% or 30 cents to R19,70.
On the downside, food group Tongaat fell 10 cents to R43,90.
Chemical and explosives group AECI lost 25 cents to R31,75.
South African producer prices for all commodities rose by 1.2% in the 12 months to end May from a 0,2% decline for the 12 months to end April, Statistics South Africa said on Thursday. On the month, the PPI was unchanged from a 1,0% monthly rise in April.
An I-Net Bridge survey of economists, PPI was expected to rise 1,5% y/y from a decline of -0,2% in April and -1,2% in March. The range was from 0,8% y/y to 2% y/y. – I-Net Bridge