South African stocks extended gains by noon on Wednesday, with resource and gold counters firmly leading the upside as market participants looked for bargains at current low levels.
The JSE all-share index had gained 2,40%. Resources were up 3,89% and gold counters firmed 3,74%, but platinum miners were flat, up 0,04%.
Banks put on 3,54%, financials collected 2,10% and industrials edged up 0,88%.
The rand was last bid at 10,47 to the dollar from 10,44 when the JSE closed on Tuesday. Gold was quoted at $915,80/oz a troy ounce from $925,65/oz at the JSE’s last close, and platinum was at $1 047,50/oz from its previous close of $1 030,50/oz.
“This is a follow through on the better Eastern markets. News out there is still negative but this has been priced into the market to a large extent and everyone at the moment is looking for bargains. It’s not unrealistic for the market to rally,” an equities trader said.
“The rand is better than this morning’s levels. It is in a basket of emerging currencies that have been suffering and at the moment it is trying to recover.
“Although some shares are still under pressure, the market is picking up nicely. Sentiment is a bit better. Dow futures are picking up, hopefully the US will see a recovery tonight. If they do, then we will see markets rally to better levels.”
Dow Jones Newswires reports that the FTSE 100 was higher on the back of a strong mining sector and a positive response to CIPS services PMI. James Knightly, economist at ING Bank, said that the PMI data added to the positive news flow following the surprise rise in the Nationwide consumer confidence index.
He noted that the PMI index rose for the third straight month but still showed a sharp contraction in output, and the labour market component remains close to its all-time low.
He continued to look for a 0,5% base-rate cut Thursday, and also awaited details on quantitative easing.
US stocks are expected rise at the open on the back of rallies seen in Europe and Asia, said Martin Slaney, trader at GFT. He called the DJIA to open up 55 points and the S&P 500 up 6,7 points.
On the JSE, Anglo American was up R8, or 5,76%, to R147 and BHP Billiton put on R8.10, or 5,21%, to R163,50. Petrochemicals group Sasol firmed R6,80, or 2,72%, to R256,80.
Paper group Sappi collected 40 cents, or 2,94%, to R14 but rival Mondi eased 10 cents to R22,40.
ArcelorMittal edged up 54 cents to R73,94, Highveld Steel strengthened R3,98, or 6,12%, to R68,99 and Kumba Iron Ore firmed R2,69, or 1,55%, to R176,49.
Gold miner AngloGold Ashanti added R7,30, or 2,43%, to R307,30, Gold Fields was up R7, or 7,41%, to R101,50 and Harmony firmed R2,56, or 2,20%, to R118,98.
Platinum miner Anglo Platinum gave up R5,75, or 1,41%, to R403 but Lonmin collected R8,75, or 5,86%, to R158. Among industrials on the JSE, brewer SABMiller edged up 45 cents to R141.60, Remgro added R1.82, or 2,73%, to R68,43, Bidvest gained R2,81, or 3,54%, to R82,26 and Imperial rose R2,13, or 5,31%, to R42,23.
Banker Standard Bank was up R2,35, or 3,88%, to R62,85, Absa firmed R1,54, or 1,86%, to R84,55 and FirstRand was up 54 cents, or 4,84%, to R11,70.
Nedbank collected R1,82, or 2,60%, to R71,82. The bank earlier that it shares interests in certain joint ventures with the Old Mutual Group. The joint ventures are presently managed within the Retail Division of the Nedbank Group.
Discussions are in progress in terms of which Nedbank Group may acquire the Old Mutual Group’s interests in the joint ventures in exchange for shares in the Nedbank Group.
At this stage no definitive terms have been agreed upon, it said. Financial services group Old Mutual gained 11 cents, or 1,95%, to R5,75. It earlier reported a decline in adjusted earnings per share from 16,9 pence to 12,2 pence for the year ended December. Basic earnings per share for the 12 months declined from 19,2 pence to 8,6 pence. The adjusted operating profit before tax on IFRS basis decreased from £1,624-billion to £999-million.
Sanlam strengthened 34 cents, or 2,27%, to R15,35 and Investec rose 40 cents, or 1,39%, to R29,10.
Retailer Truworths was up 47 cents, or 1,54%, to R30,97, Pick n Pay added 32 cents, or 1,04%, to R31,07, JD Group put on 74 cents, or 2,64%, to R28,74 and Foschini gained R1,06, or 2,69%, to R40,51.
However, Steinhoff weakened 44 cents, or 4,46%, to R9,43.
Liberty International lost 50 cents, or 1,10%, to R45. Construction group Aveng collected 32 cents, or 1,24%, to R26,12 and Group Five was up R1,60, or 5,82%, to R29,10.
However, WBHO was down 90 cents, or 1,04%, to R85,60 and Basil Read lost 20 cents, or 1,67%, to R11,80. ICT group Gijima AST added one cent, or 3,13%, to 33 cents.
It earlier reported diluted headline earnings per share of 4,27 cents for the six months ended December 2008 from 4,29 cents a year ago. Revenue grew by 25% to R1,5-billion, while earnings before interest tax depreciation and amortisation before exchange rate gains and losses was up 67% to R129-million.
Operating profit grew to R80,16-million from R68,35-million before.
Agricultural services business Afgri was unchanged at R3,85. It earlier reported an 11,3% increase in headline earnings per share to 43,5 cents for the six months ended December 2008. An interim dividend of 19,7 cents per share was declared.
Chris Venter, the recently appointed CEO, said that the good results were driven, in part, by a near-record maize crop in the Mpumalanga, North West and Free State provinces resulting in record receipts into the group’s silos.
Total sales from continuing operations increased by 18,5% to R4,950-billion, resulting in a profit before tax of R322-million — a 64,3% increase.
Vertically integrated solid wood products group, the York Timber Organisation, was unchanged at R11,50. It earlier reported an 84,4% decline in fully diluted headline earnings per share to 26,5 cents for the six months ended December.
This is after accounting for the fully convertible preference shares issued in the company’s BEE transaction in February 2007.
Comparing the results to the pro forma corresponding six-month period to December 31 2007, headline earnings per share were 27,4 cents, 84,2% down on the comparable period.
Among telecommunications groups, MTN Group edged up four cents to R87,03 and Telkom put on R1,27, or 1,28%, to R100,26. — I-Net Bridge