The JSE burst through the eagerly anticipated 20 000 level for the first time ever on Wednesday afternoon, led by rampant resources stocks.
At 3.12pm, the all-share index was up 1,51% at 20 043,4, having touched a record high of 20 046,699 a few minutes earlier. The Top 40 index was 1,62% stronger at 18 175,22. It earlier reached a record 18 180,779.
A dealer said there was a lot of futures-related buying coming through on the JSE.
“I think short-term traders were short. People tended to be bearish around these levels. They expected the market to go lower and didn’t expect it to go so strong,” a dealer said.
Only three shares were down on the Top 40 index, which is a good indication that the strength was at least in part futures related.
The dealer added that there was a lot of strength in resources, particularly platinum and gold shares. This had spread to the rest of the market.
While the JSE opened lower on the back of a weaker Dow overnight and expectations of more weakness after Google released disappointing results after the close in New York, it kicked up when European markets turned positive.
Expectations of a down day locally due to the weakness in the United States could have contributed to a short squeeze in the market. — I-Net Bridge