/ 3 June 2008

JSE remains mixed, banks weigh

Stocks were slightly lower at noon on Tuesday with banks dominating the loser board on inflation worries, but miners capped losses on a weaker rand and firm metal prices, traders said.

At 11.56am, the all-share index was down 0,23%, weighed by a 1,70% drop in banks. Financials lost 0,75% and industrials were off 0,19%.

Resources fell 0,07%, while the gold and platinum mining indices added 0,78% and 0,26% respectively.

The rand was bid at 7,72 to the US dollar from 7,70 when the JSE closed on Monday, while gold was quoted at $894,18 a troy ounce from $896,70/oz at the JSE’s last close.

Traders said banks continued to be pressured by inflation and interest rate worries following last week’s inflation data and monetary authorities’ comments on a possible 200 basis points rate hike.

“Banks have not been the favoured stocks over the past few months. I don’t think that’s about to change ahead of next week’s interest rates decision,” one trader said.

But modest gains among miners and several rand-hedged stocks on the back of firmer metal prices and the weaker rand limited the losses on the benchmark index, traders said.

Meanwhile, auto dealers suffered losses after the poor May new vehicle sales last month with Barloworld down R1,43, or 1,44%, to R97,57 and Imperial Holdings tumbling R1,40, or 2.70%, to R50,50.

The National Association of Automobile Manufacturers of South Africa said earlier that new vehicle sales fell by 23,4% y/y in May as high interest rates continued to eat into consumers’ pockets.

Among banks and retailers, Standard Bank was down R1,69, or 2,07%, to R80,01 and Absa fell R1,61, or 1,89%, to R83,38.

Wholesale retailer Massmart was R2,54, or 3,73%, weaker at R65,55 and JD Group was down 75 cents, or 2,51%, at R29,15.

On the resource index, Anglo American edged down 55 cents to R517,50 and BHP Billiton was off R2,60 at R293,40.

Sasol added R5,31, or 1,14%, to R470,31.

Gold miner AngloGold Ashanti added R1,33 to R268,43, Harmony perked up R1,28, or 1,43%, to R90,88 and Gold Fields gained 95 cents to R99,50.

Platinum Anglo Platinum was off R16,38, or 1,24%, to R1 306,62, but Impala Platinum gained R4, or 1,23%, to R329,50.

Elsewhere, takeover target Telkom notched up a further R2,01, or 1,35%, to R150,50. Telecoms group MTN, which is also in M&A play, fell R2,65, or 1,80%, to R144,25. – I-Net Bridge