JSE stays positive on bargain-hunting

The JSE extended its gains and was more than 300 points firmer by midday on Tuesday with metal stocks holding firmly as market participants looked for bargains.

Gold counters, however, remained under pressure on continued profit-taking.

The JSE all-share index had gained 1,50%, with resources adding 1,08% and platinum miners rising 2%. However, gold stocks lost 1,81%.

Banks were up 2,75%, financials gained 2,03% and industrials put on 1,56%.

The rand was last bid at R10,07 to the dollar, from R10,06 when the JSE closed on Monday.

Gold was quoted at $893,75/oz a troy ounce from $905,65/oz at the JSE’s last close, and platinum was at $951/oz from its previous close of $960,50/oz.

“We have been overdone on the downside and markets need to recover.

There is bargain-hunting at these low levels,” a trader said.

“This is the bounce that comes after the recent falls. The dollar is weakening and that is helping these metal prices. And that, of course, is a big indicator of sentiment.

“There is profit-taking in the gold stocks and that is expected after the recent rallies. Going forward, we will continue to watch and track movements in the Dow,” he added.

Dow Jones Newswires reports that London stocks fell deeper into the red. Traders bemoaned the lack of direction in the market and identified some profit-taking. “Although there is still potential for a short-term rally into February, the lack of direction seems to put that debate to bed, for now,” a trader said.

The FTSE was last down 0,96%.

US stocks are seen rising sharply at the open, on expectations that corporate earnings would surprise to the upside, given that so much bad news is already priced into the markets, said Martin Slaney, trader at GFT Global Markets.

He called the DJIA to open 80 points higher and the S&P 500 up 10 points.

On the JSE, resources giant Anglo American added R1,28 to R187 and BHP Billiton gained R2, or 1,17%, to R173,40.

Petrochemicals group Sasol firmed R5,11, or 1,91%, to R273,01.

ArcelorMittal was up R2,52, or 3,36%, to R77,50 and Kumba Iron Ore collected R3,52, or 2,51%, to R143,52.

Gold miner AngloGold Ashanti lost R4,43, or 1,52%, to R286,42, Gold Fields weakened R3,75, or 3,64%, to R99,25 and Harmony weakened 35 cents to R115,65.

DiamondCorp was unchanged at R4,60. The diamond miner earlier reported that diamond prices had suffered a significant drop in the second half of 2008, with prices received falling 50% in the last quarter of the year.

Platinum miner Anglo Platinum edged up 39 cents to R435,38, Impala Platinum was up R3,25, or 2,66%, to R125,50 and Lonmin rose 60 cents to R120.

In diversified miners, African Rainbow firmed R5,71, or 5,99%, to R101,01 and Exxaro was up R3,31, or 5,11%, to R68,06.

Elsewhere on the JSE, brewer SABMiller collected R2,40, or 1,52%, to R160, Remgro was up R1,07, or 1,53%, to R71,06 and Bidvest rose R1,96, or 2,05%, to R97,46.

However, Barloworld lost R1,40, or 4,01%, to R33,50.

Among banks, Standard Bank added R1,86, or 2,62%, to R72,86, Nedbank firmed R2,37, or 2,58%, to R94,37, Absa was up R2,49, or 2,68%, to R95,50 and FirstRand collected 35 cents, or 2,63%, to R13,65.

First National Bank said earlier it was increasing its African banking network with the latest announcement that the bank has been granted a banking licence by the Bank of Zambia.

FNB’s Zambia operations, which are set to start in the second quarter of 2009, will add to FNB’s current African footprint which includes Namibia, Botswana, Swaziland, Lesotho and Mozambique.

Financial services group Old Mutual rose 26 cents, or 3,34%, to R8,04 and RMB Holdings was up 65 cents, or 3,12%, to R21,50.

Media group Naspers was up R4, or 2,66%, to R154,50 but Avusa lost 20 cents, or 1,11%, to R17,80.

Retailer Spar weakened 70 cents, or 1,28%, to R54,17, but Massmart was up R1,75, or 2,15%, to R83,25, Lewis added 45 cents, or 1,06%, to R42,80 and JD Group put on 44 cents, or 1,21%, to R36,75.

Construction group Murray & Roberts weakened R1,25, or 2,81%, to R43,25, but cement group Pretoria Portland Cement was up 71 cents, or 2,55%, to R28,56.

Telecommunications group MTN Group gained R3,36, or 3,52%, to R98,86 and Telkom firmed 80 cents to R113,30.

Mobile carrier Vodacom, in which telecoms company Telkom holds 50%, reported earlier that its group revenue for the nine months to December 31 had lifted 13,7% to R40,5-billion.

The company said that this increase was largely driven by a 14,3% increase in group mobile customers to 37,8 million. The group’s non-South African operations comprised 11,3 million customers, or 30% of the total customer base as at 31 December 2008. — I-Net Bridge

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