The JSE Securities Exchange (JSE) was in positive territory in noon trade on Thursday, defying the rand, which remained strong below the R6-per-dollar level. Solid results released by Swiss-listed luxury goods group Richemont and London-listed brewer SABMiller before the opening fuelled already positive sentiment.
By 12.04pm, the all-share and all-share industrial indices were up 0,23% and 0,39% respectively. Resources rose 0,33% and the platinum-mining index picked up 0,29%, but the gold-mining index surrendered 1,85%. Financials fell 0,14% and the banks index was 0,29% in the red.
The rand was quoted at R5,97 per dollar from R5,99 when the JSE closed on Wednesday, while gold was quoted at $443,80 an ounce from $443,30/oz at the JSE’s last close.
“It has been a bit of a dodgem car ride — guys don’t know where to trade this market. The rand firmed to R5,95 to R5,96, and the market tried to come easier, but the gold price went above $446, which offset this to an extent,” a dealer said.
He added that while the strong rand will be negative for resources, in the end it will be positive for some stocks.
Despite the currency’s strength, underlying sentiment in the market was still positive and there was still buying coming in. The positive results released on Thursday went a long way to help in this regard.
On the JSE’s upside, SABMiller shares surged to a lifetime high of R97,50 and were last quoted at R96,75 — still up 2,38% or R2,25 on the day.
SABMiller reported a 31% increase in adjusted earnings before tax to $1,05-billion from $800-million a year ago.
Adjusted earnings per share were up 38% to 484 United States cents from 35,4 cents previously, while in rand terms, they grew 18% to 316,9 cents from 267,7 cents before.
Basic earnings per share were up 127% to 58,5 US cents.
An interim dividend of 12 US cents per share was declared, up from 7,5 cents for the same period a year ago.
“SABMiller’s results were just awesome. They were double what people were expecting and their expectations are also pretty solid going forward,” the dealer commented.
Richemont rallied 1,08% or 20 cents to R18,76. Richemont earlier traded at its highest level since September 2002 of R19,07.
Richemont reported a 14% increase in sales to €1,739-billion for the six months ended September 30, from €1,526-billion for the same period a year ago.
The group’s operating profit was 157% higher at €208-million, while net profit was up 42% to €411-million. Earnings per unit on a fully diluted basis were up 42% to €0,743 from €0,524.
“Richemont’s results were slightly better than forecast. They are looking good going forward and are expecting good pre-Christmas season sales,” the dealer said.
London-listed diversified resources group Anglo American added 1,16% or R1,65 to R143,75, and BHP Billiton was 49 cents better at R65,70.
London-listed IT group Dimension Data, which jumped 4,45% on Wednesday, leaped a further 4,93% or 17 cents to trade at R3,62. Didata on Wednesday reported adjusted earnings per share of 0,9 US cents for the year ended September 30, from a 2,7 US cents loss reported a year ago.
Financial services group Sanlam strengthened six cents to R11,33, and transport and logistics group Imperial improved 1,26% or R1,28 to R102,80.
On the JSE’s downside, AngloGold Ashanti tumbled 2,24% or R5,60 to R244,60. Gold Fields fell 1,75% or R1,56 to R87,50, and Harmony retreated 1,73% or R1,20 to R68.
Gold on Thursday traded at a 16-year high of $446,28/oz.
Hospital group Netcare extended Wednesday’s losses, weakening 1,42% or seven cents to R4,85.
Netcare shares plunged on Wednesday after the group reported an 11,4% increase in basic headline earnings per share of 45,9 cents for the year ended September 30, from 41,2 cents in 2003.
The group’s diluted headline earnings per share amounted to 44,1 cents, from 39,3 cents a year ago.
The group declared a final capital distribution of 11,5 cents per share, representing a 26,7% increase on the previous comparable period. Taken together with the interim distribution of 7,5 cents per share, the total distribution for the year amounts to 19 cents.
While banking group Absa was 1,15% or 80 cents softer at R68,50, it earlier traded at a lifetime high of R69,49.
Illovo was the all-share index’s worst performer, diving 9,6% or 85 cents to eight rand. Before the opening, Illovo, South Africa’s largest sugar producer, reported a marginal increase in its interim headline earnings per share to 15,9 cents for the six months ended September 30 2004, from 15,7 cents in the previous comparative period.
The group declared an interim dividend per share of 12 cents, down 33% from 18 cents in the 2003 interim period.
Group operating profits, which decreased by 36,5% to R210,8-million, were severely affected by the continuing strong rand in respect of both sugar and downstream exports and the translation of profits. — I-Net Bridge