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Johannesburg - Technically the JSE is oversold and there are indications of bargain hunters being around, but confidence levels are still too low for a decent upside correction to take place.
That seems to be case as another promising start on the JSE this morning, with all the major indices strongly higher, fizzled out by midday today. By midday the market was fluctuating and most of the indices ware only marginally higher.
At noon the all share index was only 0.16% higher on 44 549, while the Top 40 rose only 0.18% to trade slightly above the 40 000-mark at 40 038.
After the JSE ended up marginally higher on Wednesday, analysts expected that share prices might edge higher again today.
The markets in Asia and Europe were also initially higher on bargain hunting, but investors soon move to the sidelines ahead of the crucial US government jobs data to be released on Friday.
This data will give a better indication of the state of the American economy than this week’s mixed picture.
Wednesday's data — the non-manufacturing ISM data and the ADP employment report — was positive, which removes some of the concern over the American economy created by the weakness in other data earlier this week.
Investors are watching American economic data closely to gauge the Federal Reserve’s next move on tapering, which has already led to major outflows from emerging markets.
The markets were also focused on the European central bank meeting on Thursday. Rand Merchant Bank said in a note no change in monetary policy is expected, but there is increasing pressure on the bank to cut rates further after last year’s surprise cuts, as inflation is very low in the eurozone.
Imara SP Reid said in its market watch this morning the oversold position on the very short term on the JSE will create additional upside in today's trading. It said the all share index is likely to target the 45 000 area, but by midday the market was too nervous for that.
Platinum shares are still in the spotlight as a proposal
by the CCMA to facilitate a
settlement in the wage strike bombed out. The CCMA will now engage individually with the parties.
Platinum shares were initially higher, but by midday Anglo American Platinum [JSE:AMS] and Impala Platinum [JSE:IMP] have given up those gains. Implats was 17c lower on R113, while Amplats traded 261c lower at R422.39.
Bank shares were also mixed after a solid start. Standard Bank [JSE:SBK] was only 10c higher at R114.26, but Barclays Africa [JSE:BGA] was 127c lower at R261.60.
