The JSE Securities Exchange (JSE) was modestly firmer in noon trade on Tuesday, helped by a weakening rand. However, weaker United States markets overnight and a high oil price were dampening sentiment and keeping the bourse in check, dealers said.
By 11.55am, the all-share index was up 0,11%. Industrials climbed 0,42%, while financials were 0,13% firmer. Resources retreated 0,23% and the platinum-mining index dipped 0,16%, but the gold-mining index gained 0,69%. The banks index was 1,03% in the red.
The rand was quoted at R5,85 per dollar from R5,80 when the JSE closed on Monday, while gold was quoted at $434,20 a troy ounce from $435,40/oz at the JSE’s last close.
“We opened mixed, but the market seems to be wanting to go a bit firmer. The rand is starting to weaken, which is helping,” a dealer said.
He added that there was a definite lack of interest in the market. With US markets down overnight, it was taking a bit of a breather after its rally to record highs over the previous two trading sessions.
A second dealer expressed similar views. He said that while the rand was lifting the JSE, weakness in US markets overnight was dampening sentiment.
There were also worries about the effect of the high oil price on the economy.
While private sector credit extension (PSCE) data released earlier was better than expected, it nevertheless showed that consumer demand remains buoyant and was seen by some as decreasing the likelihood of an interest-rate cut in April. This was also weighing on the JSE.
Data released by the South African Reserve Bank (SARB) at 8am showed that the rate of growth of South Africa’s broad M3 money supply measure rose by 11,98% in the year to the end of January from a revised 12,79% (12,82%) in the year to the end of December.
PSCE grew at a rate of 15,22% year-on-year (y/y) in January from a revised 13,45% (13,64%) y/y in December.
Economists had seen the M3 rising to 13,1% y/y, according to the median forecast of private sector economists surveyed by I-Net Bridge. The range of forecasts was from 11,6% y/y to 15,1% y/y.
The PSCE growth rate was seen rising to 16,5% y/y, with the range of forecasts from 15,0% y/y to 17,5% y/y.
On the JSE’s resources index, BHP Billiton weakened 1,16% or one rand to R85,20 after rallying to record highs in recent days.
Gold miner Harmony was down 42 cents at R49,58.
Gold Fields, however, leaped 2,1% or R1,45 to R70,50 and AngloGold Ashanti advanced two rand to R210.
Diversified miner Kumba surged 2,04% or R1,30 to R64,90.
Petrochemicals group Sasol strengthened 55 cents to R146,55. It earlier traded at a lifetime high of R147,50.
Among industrials, Swiss-listed luxury goods group Richemont rose 1,36% or 25 cents to R18,58.
Food group Tiger Brands firmed 1,96% or two rand to R103,80.
Cellular network operator MTN Group gained 31 cents to R48,10 and Telkom rang up 1,28% or R1,45 to R114,75. MTN’s intraday high of R48,30 was its strongest in five years.
Media group Naspers was up 2,11% or R1,64 at R79,50, while Johnnic Communications rocketed 9,33% or R3,50 to a highest-to-date R41.
Primedia N shares were up 2,61% or 30 cents at R11,80.
Before the opening, Primedia reported a 34,4% increase in headline earnings per share for the six months ended December 2004 to 43 cents, from 32 cents a year earlier. The group increased its interim distribution per share by 40,1% to 22 cents, from 15,7 cents a year ago.
On the downside, construction group Murray & Roberts slipped 1,97% or 30 cents to R14,95.
After the close on Monday, the company reported a 10% decline in headline in earnings per share from 74 cents to 66 cents for the six months to the end of December.
Retailer Edcon retreated 1,68% or five rand to R292 and Foschini fell 1,24% or 49 cents to R39.
Services group Bidvest was again under pressure, tumbling 2,14% or R1,62 to R73,99. On Monday, it reported a 29,1% increase in headline earnings per share for the half-year ended December 31 2004 to 319,5 cents, from 247,5 cents for the same period a year ago. The company declared an interim cash distribution in lieu of a dividend of 133,8 cents — up 18% or 113,4 cents a share in 2003.
London-listed financial services group Old Mutual firmed 1,27% or 20 cents to R15,98 and Sanlam jumped 1,87% or 20 cents to an all-time high of R13,60.
Old Mutual’s intraday high of R16 was its strongest since mid-2002. Old Mutual on Monday reported a 46% increase in its adjusted operating earnings per share (EPS) for the year to the end of December 2004 to 181,1 South African cents, versus 123,8 cents the year earlier.
The group declared a final dividend of 3,5 pence, up 13% from 2003 levels, for a total dividend for the year of 5,25 pence.
Investment bank Investec plc improved 1,28% or R2,22 to R176,23.
Standard Bank, however, slipped 1,62% or R1,04 to R63,23 and FirstRand fell 1,36% or 19 cents to R13,80.
A dealer said that FirstRand’s results, released before the opening, were in line with consensus. Weakness in the banking sector, which was down due to the rand, was dragging the stock lower.
Before the opening, FirstRand said that it had boosted headline earnings by 23% from R2,736-billion to R3,355-billion for the six months to the end of December.
This translated into headline earnings per share of 63,9 cents versus 52,7 cents per share for the previous comparative half-year.
The group declared an interim dividend of 26,6 cents, which was 38% more than the 19,25 cents per share, declared previously. — I-Net Bridge