Resources stocks steamed ahead on the JSE Securities Exchange South Africa (JSE) on Monday, pulling the all share index safely into the black in noon trade. Dealers said the strength was primarily a rand play, with no other major drivers on the market.
The all share index was up 0,87% at noon. Resources were 1,87% stronger, with the gold and platinum mining indices gaining 1,16% and 0,54% respectively. The all share industrial (+0,06%) and financial (-0,09%) indices were flat, while the banks index fell 1,59% in morning trade.
The rand was trading at R7,50 to the dollar from R7,42 when the JSE closed on Friday, while gold was quoted at $376,50 an ounce from $375,40/oz at the JSE’s last close.
A dealer said the JSE was up on the back of the rand, which was weaker on speculation the South African Reserve Bank’s Monetary Policy Committee would cut interest rates at a special meeting scheduled for Wednesday. Favourable interest rate differentials are widely regarded as a reason for the rand’s strength in recent months.
“The gold price is going through the roof and the rand is weak, but gold stocks aren’t up as much as we thought they would be. They might have been a bit overdone on Thursday and Friday — there was far too much demand — and people might be waiting for some kind of guarantee that the shares deserve to be this high and that the gold price will remain at these levels,” he said.
The gold mining index was up almost 8% on Friday. London-listed diversified resources group Anglo American led the JSE’s upside on Monday, advancing R3,78 to R145,10. It earlier traded as high as R145,50 rand — its best level since July last year.
BHP Billiton climbed 1,96% to R52 and synthetic fuels group Sasol was 2,31% stronger at R88. Before the opening, Sasol reported a decline in basic headline earnings per share to 1,280c for the year ended June 30 from 1,597c a year ago.
Sasol was expected to report headline earnings per share of 1 149,8c, according to the I-Net Bridge consensus of 10 analysts. The 10 forecasts ranged from 1 114c to 1 305,2c.
AngloGold added 1,71% to R106,40, Gold Fields gained 65c to R106,40 and Harmony was R1,01 higher at R113,50. Impala Platinum was up R6,95 at R611. Pulp and paper producer Sappi led the upside of the all share industrial index, climbing 1,5% to R101,50.
Steel conglomerate Iscor was 3,57% stronger at R23,20. London-listed IT group Dimension Data was up 1,58% at R3,85 and beverages group SABMiller was 30c better at R55,50. London-listed financial services group Old Mutual firmed 2,86% to R12,60 and Liberty International was 80c better at R81,80.
On the JSE’s downside, Standard Bank slipped 2,27% to R32,25. Its losses were exacerbated by the fact it went ex-dividend of 41,5c per share.
FirstRand fell 1,19% to R7,49 and Nedcor lost 75c to R77,75. RMB Holdings tumbled 2,69% to R10,51. Cellular network operator MTN Group shed 2,31% to R18,61.
Among retailers, Shoprite was down 2,15% at R7,28 after going ex-dividend of 16,5c per share, while Truworths, which also went ex-dividend (21c per share), was 2,04% softer at R7,69. — I-Net Bridge