The JSE Securities Exchange South Africa (JSE) forged ahead at the start on Wednesday, led by heavyweight rand hedge stocks. This followed the rand’s depreciation above the 8,90 to the dollar level and warnings by currency traders that the rand was heading back above 9 to the greenback.
At 0911, the all share index was up 1%. The indi-25 had jumped 1,37%, while financials were 0,88% firmer. Resources had rallied 0,99% and the platinum mining index was 1,59% in the black. The IT index was up 2,13%. On the downside, the gold mining index had surrendered 1,96%.
The rand was trading at 8,9300 to the dollar from 8,7375 when the JSE closed on Tuesday, while gold was quoted at $352,20 an ounce, down just over US$1 from the JSE’s last close.
Dealers said that the JSE was almost entirely being driven by the weaker rand, with all of the rand hedges stocks posting good gains.
The only exceptions to this were in the gold mining index. A dealer said that the gold price was slightly weaker and the gold ADRs had also come off in the States overnight. Wall Street was up overnight and there is an inverse relationship between the performance of the gold ADRs and Wall Street.
Shares to gain on the JSE in early trade on Wednesday included London-listed diversified resources group Anglo American (AGL), which advanced 2,41% or R3,14 to R133,30. BHP Billiton (BIL) climbed 1,08% or 50 cents to R47.
Synthetic fuels group Sasol (SOL), the most actively traded share in terms of value, had bounced 1,87% or R1,90 to R103,30 after closing in the red on Tuesday.
On the indi-25, Swiss-listed luxury goods group Richemont (RCH) was 2,14% or 35 cents stronger at R16,70 and London-listed beverages group SABMiller (SAB) was 1,62% or one rand stronger at R62,80.
On the financial index, London-listed Old Mutual (OML) was up 2,24% or 29 cents to R13,24, while Investec Plc (INP) was up 1,33% or R1,50 to R114,50.
On the downside of the market, Gold Fields (GFI) was 2,64% or R3,25 in the red at R119,70, AngloGold (ANG) gave up 1,60% or R4,99 to 307,01 rand and Harmony (HAR) was 1,71% or R2,50 lower at R144.
Currency traders said the rand was heading for R9 per dollar and several stop losses were likely to be triggered along the way. They expected the rand to reach 9,05 rand per dollar today, but then to come back to below 9 by the end of the week.
Dow Jones Newswires reports that US stocks staged a late-day advance, reflecting investors’ growing anticipation of positive fourth-quarter earnings, including those from Intel, which reported after the bell.
The Dow Jones Industrial Average gained 56,54, or 0,6%, to 8,842.62, the Nasdaq Composite Index rose 14,97, or 1%, to 1,461.01 and the Standard & Poor’s 500 Index added 5,40, or 0,6%, to 931,66. – I-Net-Bridge