/ 7 May 2008

JSE: Sasol gains as volatility rules roost

South African stocks were mixed in early afternoon trade on Wednesday due to volatility, but the feature of the morning session was a strong gain by synthetic fuel producer Sasol.

At 12.25pm, the JSE’s broader all-share index was up 0,09%, with the industrial index up 0,88%, but resources were down 0,38%. Platinum was up 0,9% and banks by 0,9%, while gold was up 0,3%. Financials were down by a marginal 0,06%.

The rand was bid at 7,50 to the dollar from 7,55 when the JSE closed on Tuesday, while gold was quoted at $870,60 a troy ounce from $881,70/oz at the JSE’s last close.

“Sasol is a feature again — it is still a commodity play,” noted an equities specialist.

“AngloGold is also moving on their hedge story,” he added.

“Internationally, British American Tobacco released results and this is having a positive effect on Remgro and Richemont,” he added.

“Telkom is also moving in sympathy with MTN,” said the dealer.

The dealer concluded that it was a stock-pickers’ market at the moment due to the volatility.

Synthetic fuels maker Sasol was up R13,01, or 2,78%, at R481,01 as the oil price continued to trade near record highs. Brent crude futures were last at $119,98 per barrel.

On the resource index, Anglo American lost R9,75, or 1,87%, to R510,75 and BHP Billiton dipped R3,80, or 1,32%, to R284,30. AngloGold Ashanti was at R294, a gain of R7, or 2,44%.

AngloGold Ashanti on Tuesday reported a widening of its quarterly loss from R10,99 in the December quarter to R13,76 in the March quarter.

Despite the higher gold price, the company reduced its total net delta hedge by 1,13-million ounces to 9,26-million ounces during the quarter, which reduces its total hedge commitments from 11,28-million ounces to 10,03-million ounces.

South African mobile services provider MTN is in talks with India’s Bharti Airtel, which is reportedly hoping to pitch an offer for the local company. This news helped add some support to the rand.

MTN Group was the blue chip’s second-highest gainer after it confirmed late on Monday that it was in the price-sensitive talks with Bharti Airtel.

Shares in MTN rallied nearly 10% in early deals to set a new record intraday high of R165 on Tuesday, but pulled back at midday to trade 5,99%, or R8,98, higher at R158,98. It was last at R160,15, a gain of 15 cents.

Luxury goods group, Richemont collected 49 cents, or 1,04%, to R47,39, while Remgro gained a healthy R3,20, or 1,6%, to R203,20. — I-Net Bridge