FRIDAY, 1.00PM
JSE industrials posted small gains in early trade on Friday, but dealers say they expect little action ahead of the September futures contract close-out later in the day. At 10.30am the industrial index was up 12,4 points at 8816,2, the all-gold index was down 5,7 points at 910,6, leaving the all-share index 6,3 points better at 7198,1.
Dealers say that most big players will remain on the sidelines until the futures close-out at 4pm. “There are no fundamentals driving today’s market, it’s purely the close-out. It’s a toss up which way it will go and it all depends where the big players are positioned,” said one equity trader.
Gold counters remain under pressure as investors stay away, waiting to see where the gold price will head next. The yellow metal was last at $321,10 an ounce from $320,65 at the New York close.
THURSDAY, 6.00PM
INDUSTRIAL shares on the Johannesburg Stock Exchange ended Thursday on a cautiously optimistic note, with the market was still in the grips of futures manipulation and a postive opening of the New York Stock Exchange lifting spirits later in the day. However, the overall market ended flat.
At the close the all gold index had dipped five points to 916, but the industrial index had climbed 17,3 points to 8 811,2, while the all share index indicated a more neutral outlook as it ended flat at 7 191,8.
Dealers said the market was still very confused about just where the September futures close-out would end, with there being a very hard-fought battle between those who are calling the industrial and all share futures up and those who want them to go the other way. “Fundamentals are playing no role in the market at the moment and the usual story with a futures close-out is those who have the deepest pockets win,” a dealer said.
A strong 30-point opening on the Dow Jones Industrial Average helped stimulate industrial shares in the closing minutes. Banking shares, meanwhile, managed to extend their Wednesday gains, pushing the financial index 19,2 points higher to 10 165,4.
The rand ended the day firmer against the dollar as excess dollars were sold off. At 4:30pm the local unit was quoted at R4,6765 to the dollar from Wednesday’s close of R4,6805. It had traded between bids of R4,6730 and R4,6850 during the day. On the crosses the rand was mixed. Against the British Pound it was last quoted at R7,5310 from R7,4740 late on Wednesday. The local unit was last quoted at DM0,3787 from DM0,3787 and at 26,03 yen from 25,83 yen before.
Bonds closed little changed on Thursday as yields remained confined to a narrow range. At 4:30pm the key government bond, the R150, was little changed at a 13,94% yield, while the longer dated R153 was one point firmer at 14,07%. Dealers said they expect bond yields to consolidate around current levels, but they expect the key 14% level to hold. They added that the local market continues to garner strength from firm US bonds. The market is seeking direction from external sources as there is no fresh local news. Late demand for the R153 pushed yields down shortly before the close.