JSE falls in line with global stocks

Johannesburg - The JSE lost a bit of ground at its opening on Thursday, in line with global stocks, with US data and earnings season later in the day expected to drive further sentiment.

By 09:21 local time, the JSE All Share [JSE:J203] index gave up 0.29%, with resources off 0.49%. Gold miners however, added 1.21%, along with platinum miners, 0.22% higher. Banks declined 0.22%, industrials drifted 0.20% lower and financials shed 0.20%.

The rand was bid at R7.82 to the dollar, from R7.78 at the JSE's close on Wednesday. Gold traded at $1 673.50 a troy ounce from $1 677.97/oz at the JSE's previous close, while platinum was at $1 544.70/oz, from $1 544/oz previously.

A local trader said that US futures were slightly in the red, adding that the local bourse had experienced "a nice move" over the past few days. "We are likely to continue taking our lead from international markets driven by US data later in the day," she said.

European stocks started down on Thursday, with Dow Jones Newswires reporting that markets were pausing for breath after solid gains in the previous session, where stocks hit intraday highs not seen since the start of August.

Investors were also digesting the recapitalisation plans outlined by European Commission President Jose Manuel Barroso. On Wednesday, the Stoxx Europe 600 banks index closed up 2.9% after Barroso told the European parliament that the region must "urgently strengthen the banks". However, details were light, said Citigroup.

Citigroup added: "While a bank recapitalisation may provide additional confidence to funding markets, we believe this is not an alternative to addressing the 'core' issue-namely providing a credible sovereign liquidity backstop and, over time, creating an integrated governance system for the EU to support the shift toward greater debt sustainability."

Cameron Peacock, market analyst at IG Markets, wasn't too concerned about the expected pullback at the start of European trading. He said, "It's little surprise that another phase of consolidation seems likely... although assuming the fundamentals continue to be at least in line with expectations... there's little reason to believe this will be anything more than a pause for breath."

Despite the renewed appetite for risk, many market watchers argued that stocks remained locked in the same trading range that began two months ago.

Asian stocks advanced on Thursday amid an improving mood in global markets but Korean technology stocks lost ground after Apple succeeded in blocking Samsung Electronics from selling its tablet computer in Australia.

Japan's Nikkei Stock Average rose 0.9%, Australia's S&P/ASX 200 added 1.0%, South Korea's Kospi Composite advanced 1.2%, Hong Kong's Hang Seng Index rose 1.9% and China's Shanghai Composite Index advanced 0.4%.

Data earlier showing China posted a narrower-than-expected trade surplus in September on weakening external demand was taken in stride by investors, with the main focus turning to Friday's September inflation data as speculation mounted that the world's second biggest economy may see looser monetary policy in the near term.