The JSE Securities Exchange South Africa (JSE) remained in positive territory in noon trade on Friday, but was off the morning’s best levels after gold and platinum stocks surrendered their gains. Dealers said that while the slightly weaker rand on the day was lifting the market, investors remained concerned about the effect of the currency’s long-term strength on earnings.
The all-share index was 0,78% stronger. Resources rallied 1,64% in morning trade, but the gold and platinum mining indices surrendered 1,11% and 0,63% respectively. The all-share industrial index inched up 0,24%. Financials were flat, while the banks index dipped 0,1%.
The rand was quoted at R6,33 per dollar from R6,23 when the JSE closed on Thursday, while gold was quoted at $400,35 an ounce from $401,48/oz at the JSE’s last close.
“The JSE is up mainly because of the rand,” a dealer said.
He continued that while the rand had weakened on comments by billionaire currency speculator George Soros that it had probably appreciated too much recently and its strength appeared to be hurting the country’s competitiveness, the currency remained near its best levels since early 2000.
“Gold and platinum stocks tried to bounce this morning, but have turned negative. We had profit warnings from both Impala and AngloPlat this week and people are expecting similar warnings from the gold miners. People are recognising that results going forward are going to be poor due to the rand’s strength.”
On Wednesday afternoon, the rand touched R6,0925 per dollar — its best level since January 21 2000.
Impala and AngloPlat both said this week that their earnings would be “substantially” lower due to the rand strength, which means a decrease of more than 30% in terms of the JSE’s listings requirements.
AngloPlat was down R1,11 at R260 and Impala was five rand weaker at R535.
On the gold mining index, Gold Fields gave up 1,88% or R1,55 to R81 and Harmony was 86 cents weaker at R94.
Cellular network operator MTN Group was 1,7% or 48 cents softer at R27,82, while hospital group Netcare was 4,66% or 24 cents in the red at R4,91.
On the upside, London-listed diversified resources group Anglo American advanced 2,3% or three rand to R133,60. BHP Billiton bounced 3,79% or R1,85 to R50,60 and synthetic fuels group Sasol was 2,5% or R2,05 stronger at R84,15.
Swiss-listed luxury goods group Richemont jumped 1,97% or 30 cents to R15,50, while Naspers N shares soared 4,39% or R1,80 to R42,80.
Naspers earlier traded at R42,85 — its highest level since November 2000. — I-Net Bridge