/ 26 June 2008

JSE flat after bad PPI, miners rise

The JSE was flat at noon on Thursday, giving up earlier gains after a jump in producer inflation numbers but the losses were capped by strength in the mining sector, traders said.

By 12.01pm, the all-share index was neither here nor there at -0,01%. Resources added 0,61%, while the gold and platinum mining indices gained 2,78% and 1,37% respectively.

Banks fell 0,33%, financials weakened 0,84% and industrials were down 0,63%.

The rand was bid at 7,87 to the US dollar from 7,92 when the JSE closed on Wednesday, while gold was quoted at $894,30 a troy ounce from $882,75/oz at the JSE’s last close.

After posting decent gains in early deals on the back of an overnight gains on Wall Street, the local bourse started pulling back after official data showed a jump in May producer price inflation index (PPI).

“The PPI figure that came out was very negative, that’s the reason for a retreat in banks, financials and industrials,” said Gideon Muller, a trader at Thebe Securities.

Data released by Statistics South Africa showed the PPI index rose by 16,4% year-on-year (y/y) in May from 12,4% year-on-year (y/y) in April, but Stats SA highlighted that changes to the new weightings structure had led to some anomalies in the comparative pricing of the basic iron and steel component was problematic this month and PPI, excluding iron and steel, rose to 12,2%.

However, miners held on to gains on the back of firmer metal prices following the US decision to keep rates unchanged last night, said Muller.

On resources, Anglo American gained R8, or 1,56%, to R521 but BHP Billiton fell R2,48 to R284,32.

Sasol inched down R2 to R455.

Among gold miners AngloGold Ashanti added R8,50, or 3,56%, to R247, Gold Fields was up R1,21, or 1,35%, to R91,01 and Harmony climbed R3,37, or 4,01%, to R87,37.

Platinum miner Angloplat picked up R3,22 to R1 343,22 and Implats improved R6,01, or 2,07%, to R297,01 as the platinum price nudged higher. It was last trading at 2,17%, or $34,50, higher at $2 046/oz.

Among banks, Nedbank inched up 47 cents to R91,55, Standard Bank was R1,75, or 2,28%, weaker at R75 but FirstRand climbed 45 cents, or 3,45%, to R13,50.

In the news, consumer foods firm AVI was up 11 cents to R13,20. It earlier said that its revenue for the 11 months to May 2008 was 12,2% higher at R6,028-billion, compared with R5,371-billion in the comparable period last year.

Consolidated headline earnings per share for continuing operations for the year ending June 2008 are expected to increase by between 8% and 15% over those of the previous year.

Poultry producer Astral Foods was up 91 cents to R93. It said its subsidiary Aviagen and Ross Poultry Breeders have signed an agreement giving Ross Poultry exclusive rights to the International Ross 308 breed in South Africa. – I-Net Bridge