The JSE continued its climb to record highs on Thursday, lifted by a weaker rand and stronger world markets. However, dealers said that the market’s upward momentum had eased following its phenomenal rise in recent days.
At 12.07pm, the all share index was up 0.88% at 14 801,19 after trading as high as 14 811,64. Financials firmed 1,44%, with the banks index jumping 2,41%. Industrials and resources rose 0,84% and 0,6% respectively.
While the platinum mining index picked up 0,54%, the gold mining index lost 0,89%.
Bid at 6,68 per dollar, the rand was little changed from its level when the JSE closed on Wednesday, but it weakened sharply on Wednesday afternoon following the release of better-than-expected US trade data.
Gold was quoted at $423 a troy ounce from $423.90/oz at the JSE’s last close.
The JSE is encouraging players to observe two minutes of silence at 1pm in commemoration of the victims of the London bombings last week.
The bourse will remain open, however.
“The market continued its bullish move,” said T-Sec’s Lavan Gopal. “There was a fair amount of short covering across the board and a lot of basket buying as traders played both sides of the cash and futures market.”
He continued that volumes were not as high as on Wednesday and Tuesday. There was some catch up on stocks that traders had missed out on as well as derivatives activity.
While investors were not prepared to throw a lot of cash at the market, there was also no major profit taking.
“Most investors are nervous, thinking there can be a pullback at some point. A lot of traders have got their fingers on the button waiting to take profits at first sight,” Gopal commented.
He noted that the market had rallied 750 points since its low after the London bombings last week. Traders thought this was a lot and that there could be a bit of profit taking.
Factors contributing to the JSE’s strength included firmer world markets and the rand’s weakening on Wednesday afternoon. South Africa had also benefitted from a shift in focus to emerging markets. MTN and Telkom had been upgraded and Edcon had issued a positive trading statement on Wednesday morning, all of which
contributed to bullish sentiment, he said. “South Africa looks good right now.”
On the resources index, London-listed Anglo American added 1,51% or R2,35 to R158 and BHP Billiton was 83 cents better at R89,48.
Kumba leaped 3,04% or R1,95 to R66 and Mittal Steel was 2,14% or R1,05 stronger at R50,05.
Swiss-listed luxury goods group Richemont rose 1,35% or 31 cents to R23,25 and investment company Remgro gained 1,32% or R1,41 to R108.
Retailer Edcon was up 1,02% or R3,15 at R311. It was up strongly on Wednesday after releasing a trading statement before the opening, in which it said that that total first quarter sales rose by 25% when compared to the same period last year. It added that shareowners should expect another meaningful rise in earnings in 2006, above that of the sales growth.
Foschini soared 3,21% or R1,30 to R41,80 after touching an all-time high of R42. While Truworths eased 11 cents to R18,80, it earlier traded at a best-ever R19,15.
Pick ‘n Pay leaped 2,28% or 59 cents to a lifetime high of R26,50 and Shoprite was 1,61% or 25 cents stronger at R15,80, just 15 cents off its best ever level reached earlier.
London-listed brewer SABMiller was up 34 cents at R102,70. Banking group FirstRand surged 3,93% or 59 cents to R15,60 and its major shareholder RMB Holdings was 2,71% or 65 cents higher at R24,65 — its best level since 1998. FirstRand earlier traded at a record best of R15,70.
Standard Bank, which reached a new high of R70, was 1,74% or R1,19 in the black at R69,50.
Absa also traded at a record level — R85,90 — and was quoted at R85,75, up 1,84% or R1,55 on the day.
London-listed financial services group Old Mutual firmed 1,08% or 16 cents to R14,99.
On the market’s downside, petrochemicals group Sasol slipped R1,49 to R204,50 although it earlier touched a best ever R206,40.
Gold miner Harmony gave up 1,9% or R1,10 to R56,80, Gold Fields fell 56 cents to R77,49 and AngloGold Ashanti shed R1,39 to R243,10. Pulp and paper producer Sappi was 70 cents softer at R70,30.
Telkom surrendered 50 cents to R120 and diversified industrial Imperial was off 71 cents at R107,80. – I-Net Bridge