OWN CORRESPONDENT, Johannesburg | Tuesday 4.30pm.
THE Johannesburg Stock Exchange surged on Tuesday, the overall ending 1,52% or 114 points up.
All counters finished strongly in positive territory, financials 1,52% or 146 points good and industrials 1,22% or 101 points better.
Gold shares closed 2,08% or 21 points sharper. By late afternoon gold was trading $5,50 up on international markets at $288,75 an ounce.
Traders said the current strength reflects a weak US dollar combined with a spate of short covering.
The rand lost some of Monday’s gains and at 4.15pm was trading at R6,92 to the dollar and R10,23 to the pound.
Analysts said the currency is seen firmer in the short term with a break below R6,88 to the dollar, a key move that could translate into hefty gains.
“Right now, R6,88 is the level the rand needs to beat, if you look at a regression trend taken from its firmest point of the year in early January,” said Boyde Stafne, an independent technical analyst.
Stafne said a break below R6,88 could, over the next few weeks, open a path to the current three-month average of R6,76 and then the 200-day average of R6,43.
On the other side, he said the rand should get support at R7,08 but if it cracked that level, the historic low of R7,20 reached on May 25 would quickly come back into play.
By late afternoon the Dow Jones was trading weaker 0,74% or 80 points.