/ 19 July 2006

Firmer world markets encourage JSE

The JSE was in positive territory in noon trade on Wednesday as firmer world markets encouraged bargain hunting locally. A lower bullion price saw gold stocks feature on the market’s downside.

At 12.01pm, the all share and all share industrial indices strengthened 0,41% and 0,86% respectively. Financials firmed 1,41% and the banks index jumped 2,17%.

Resources retreated 0,41%, the gold mining index slumped 3,3% and the platinum mining index lost 1,25%.

The rand was bid at 7,19 per dollar, little changed from when the JSE closed on Tuesday, while gold was quoted at $622,75 a troy ounce from $646,10/oz at the JSE’s last close.

“The market is definitely starting to pick up a bit. Guys have just been selling for three or four days solid and they are picking up some good deals. That’s what is lifting us,” said Mark Wurr, head of trading at Global Trader.

He added that the JSE was getting help from world markets and noted that European markets were firmer following the positive close on the Dow overnight.

Wurr said that there was some bargain hunting on the JSE. The fact that news out of the Middle East wasn’t all doom and gloom at the moment was playing a role, although this could change at any time.

“It certainly hasn’t been the gold price that’s been helping us. Gold is still down and it looks like it is continuing,” he commented.

Overall, the local market was confused at the moment as to whether it should move down a couple of percent.

“The view a week ago was that everything was a bit expensive and the market sold off. Now that it is holding its levels, people are scratching their heads and asking whether it is really not expensive,” Wurr explained.

Gold remained a major factor, he asserted. However, he believed that while the metal was selling off, it was consolidating before moving up again and had not broken out of its long-term bull trend.

On the JSE’s upside, global resources group BHP Billiton was 1,63% or R2,13 better at R133 and Anglo American inched up R1,25 to R276.

Coal and iron ore miner Kumba climbed 1,15% or R1,50 to R132,50.

Swiss-listed luxury goods group Richemont rose 14 cents to R30,09 and London-listed brewer SABMiller was R1,22 stronger at R125.

Food group Tiger Brands roared ahead 2,53% or R3,70 to R149,75.

Sugar and aluminium group Tongaat-Hulett jumped 1,6% or R1,50 to R95,50. It traded as high as R97 after it said that its headline earnings for the half-year ended June were expected to be R297-million, compared with R208-million in 2005. Headline earnings and headline earnings per share were expected to exceed the previous half-year by 43% and 40% respectively.

Media group Naspers notched up 2,27% or R2,55 to R114,80.

Retailer Lewis surged 4,47% or R1,99 to R46,49, JD Group jumped 2,42% or R1,50 to R63,50 and Pick ‘n Pay perked up 3,05% or 89 cents to R30,10.

Banking group FirstRand firmed 2,5% or 40 cents to R16,40 and its major shareholder RMB Holdings rallied 3,17% or 75 cents to R24,40.

Standard Bank strengthened 1,93% or R1,39 to R73,50, Nedbank notched up 1,28% or R1,35 to R107 and Absa added 1,92% or R1,85 to R98,35.

On the market’s downside, Harmony Gold dropped 4,37% or R4,76 to R104,25, Gold Fields fell 3,66% or R6,10 to R160,50 and AngloGold Ashanti slid 1,79% or R6 to R330. DRDGOLD plunged 5,91% or 65 cents to R10,35.

Impala Platinum tumbled 2,23% or R26,79 to R1 172,20 and AngloPlat slipped 1,15% or R8,20 to R702.

Petrochemicals group Sasol was 1,9% or R5 softer at R258.

After a strong showing on Tuesday, services group Bidvest surrendered 1,55% or R1,50 to R95,50. – I-Net Bridge