The JSE Securities Exchange (JSE) roared to a record high on Monday morning, fuelled by a weaker rand and strong performances by heavyweight dual-listed stocks offshore. A firmer trend on world markets further helped sentiment.
By 12.02pm, the all-share index was up 0,73% at 13,096,990 after earlier touching a highest-to-date 13Â 115,830. Industrials climbed 0,44%. Resources rallied 1,46% and the platinum-mining index picked up 0,5%, but the gold-mining index was flat (-0,02%). While financials firmed 0,17%, the banks index was 0,79% softer.
The rand was quoted at R6,19 per dollar from R6,13 when the JSE closed on Friday, while gold was quoted at $413,78 a troy ounce, down from $415,70/oz at the JSE’s last close.
A dealer said that it was primarily a currency-driven market.
“Resources stocks are not just picking up on the back of the weak rand, but also on the strong dollar,” he said. He explained that mining companies expenses were in currencies such as the rand and the Australian dollar, but their earnings were in United States dollars and the greenback’s strength was seen as helping in this regard.
“Resources stocks are really flying in London,” he commented.
He added that world markets were all firmer, which was contributing to the JSE’s strength.
On the resources index, Anglo American soared 2,1% or R3,10 to R150,60 and BHP Billiton was 1,43% or R1,10 better at R78,25.
Petrochemicals group Sasol surged 2,24% or R2,90 to R132,65. Its intraday high of R133 was its strongest since April 2002.
London-listed brewer SABMiller led industrials higher, strengthening 1,15% or R1,06 to R93,60.
Swiss-listed luxury goods group Richemont rose 1,05% or 20 cents to R19,25 and investment trust Remgro gained 80 cents to R93,80.
The dealer explained that Richemont and Remgro were benefiting from Friday’s news that an appeals court had rejected the US government’s attempt to go after past profits as part of a $280-billion racketeering case against the tobacco industry.
Pulp and paper producer Sappi leaped 2,43% or R1,80 to R75,80.
Retailer Edcon rallied 1,42% or R3,80 to R272 and Foschini rang up 2,1% or 73 cents to R35,50.
On the financial front, London-listed Old Mutual was up 2,72% or 40 cents at R15,12 after being upgraded to “buy” from “hold” by Deutsche Bank.
Investec plc was 1,15% or two rand in the black at R176.
Banking group FirstRand, however, fell 1,99% or 27 cents to R13,30. Absa shed 40 cents to R73,50, Standard Bank eased 20 cents to R62,75 and Nedcor dipped 35 cents to R70,40.
Cellular network operator MTN Group was 20 cents in the red at R43,90 and London-listed information technology group Dimension Data dropped 1,98% or nine cents to R4,45. It dived 6% on Friday after analysts said the group’s adoption of International Financial Reporting Standards in 2006 is expected to affect its results adversely.
The company was also downgraded to neutral by Merrill Lynch on the grounds that it had already reached its target price of 40p.
Hospital group Netcare weakened five cents to R5,13 after going ex-dividend of 11,5 cents per share. — I-Net Bridge