SARAH BULLEN, Cape Town | Monday 5.00pm
THE Johannesburg Stock Exchange failed to take advantage of strong domestic data in the form of better-than-expected growth in the second quarter and ended the day just up on its opening levels.
At close of trade the all share index had risen just 0,04% despite strong data showing that Gross Domestic Product for the quarter grew at 1,7%, which was significantly ahead of consensus forecasts of 0,8%.
A fairly strong showing on the industrial board which saw the index rise by 1,09% was largely wiped out by a steep fall in the all gold index which tumbled 4,20%. Gold’s losses came as the bullion price slipped to $255,90. Heavyweight gold stock came under heavy selling pressure and hard-hit were heavyweights AngloGold, Gold Fields and Durban Roodepoort Deep — which is embroiled in an industrial complaint after it fired 10000 workers from its Harties mine on Friday. The financial index also lost ground, dipping 0,04% on the day.
Dealers said that the markets largely ignored the positive domestic data, looking ahead to the setting of US interest rates later in the day. Dealers said markets are also holding out for Tuesday when new Reserve Bank governor Tito Mboweni is due to host the 78-year-old institution’s annual general meeting on Tuesday and, in keeping with tradition, will deliver the bank’s main policy statement of the year.
Despite local fears, United States’ stock gained in early trade on Monday — appearing to adjust to the possibility of an interest rate hike being announced by Federal Reserve chairman Allan Greenspan later in the day.
On the international front, Asian markets followed the tone set by the Dow Jones Industrial Average’s climb on Friday to end the day in positive territory. Both Hong Kong’s Hang Seng index (0,05%) and Tokyo’s Nikkei Dow (0,75%) gained ground on the day.
European markets followed suit, with all key markets registering clear gains as they move into the late afternoon.
The rand had a strong day in the currency markets helped by the strong GDP results to trade at R6,08 to the dollar and R9,79 to the pound by 4.30pm.