An early rally on the JSE Securities Exchange South Africa (JSE) petered out on Wednesday morning, with the all-share index drifting into the red by noon. Dealers said that caution ahead of Thursday’s futures closeout was also keeping buyers out of the market.
At 12.03pm, the all-share index was down 0,11%. Resources were 0,28% in the red, with the gold mining index falling 0,55% and the platinum mining index dipping 0,38%. Financials were flat (+0,03%), while the banks index was 0,15% weaker. The all-share industrial index inched up 0,11% in morning trade.
The rand was trading at R7,47 to the from R7,51 when the JSE closed on Wednesday, while gold was quoted at $372,25 an ounce, little changed from at the JSE’s last close.
A dealer said that while volumes were reasonable, they were boosted by futures-related activity. Many players not involved in this were taking to the sidelines until the closeout was over.
He noted that on Tuesday, the JSE got off to a strong start, was flattish at noon, but was ramped up strongly by futures players in afternoon trade.
“Genuine buyers are saying let’s wait until Friday. There are fears about what the futures guys might do and people who are not involved in the derivatives market don’t want to do anything ahead of the futures closeout,” he explained.
He said that for the most part, moves on the JSE were modest.
The dealer continued that the rand’s recovery was also weighing on the local bourse.
Shares to fall in morning trade included synthetic fuels group Sasol, which slipped 1,89% or R1,70 to R88,30.
Pulp and paper producer Sappi shed 1,12% or R1,15 to R101,75 and steel producer was 1,43% or 30 cents weaker at R20,65.
Liberty International Plc lost 2,46% or R1,97 to R78,02.
The group announced before the opening that it has launched an offering of about £240-million of convertible bonds, with a coupon of 3,65% to 3,95% per annum. The convertible price is expected to be set between 800 and 825 pence a share.
The net cash proceeds will be used to fund the group’s capital expenditure programme and for its general corporate purposes.
On the JSE’s upside, Remgro rallied 1,36% or 80 cents to R59,80.
London-lsited IT group Dimension Data soared 5,63% or 18 cents to R3,38 and financial services group Sanlam was 1,17% or nine cents stronger at R7,76.
Nail N shares were the second strongest performer on the all-share index after Dimension Data, surging 5,21% or 50 cents to R10,10.
The media group said before the opening that a consortium comprising Investec Bank Limited, TISO Private Equity Fund, Safika Holdings and Mineworkers Investment Company had completed its due diligence and had increased its firm offer for the company from R9 per Nail share to R10,50 per Nail share. — I-Net Bridge