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JSE flat as Cyprus concerns recede

Johannesburg - The JSE was flat in early Tuesday trade with banking stocks continuing to lend support‚ as Asian markets recovered as fears over a bailout plan for Cyprus receded.

Dow Jones Newswires reported that investors face a calmer session Tuesday with bourses likely slightly lower and bunds and gilts mixed thanks to signs of some flexibility in the Cyprus deal.

Cyprus must stick to a target to raise €5.8bn through any alternative proposal to a one-time levy on deposits‚ eurozone finance ministers and international lenders said after an emergency conference call on Monday but in a shift from an earlier agreement they said that deposits under €100 000 should be fully guaranteed.

In a statement issued at the end of the call the Eurogroup - as the group of eurozone finance ministers is known - said that small depositors should be differentiated to bigger depositors in the one-time levy that the Cypriot government agreed to apply in order to secure a €10bn financial-assistance package.

At 9:25am the JSE All Share [JSE:J203] index was 0.12% firmer at 40‚520.49 points‚ with platinum and gold miners adding 0.16% and 0.11% respectively and resources flat at (0.01%).

Banks buoyed the local bourse‚ adding 0.98% and the financial services index was up 0.58%.

Until there is more clarity on the Cyprus situation‚ we would expect market participants to remain anxious and risk appetite to remain muted‚ Barclays Bank said in a morning note.

It has been a pretty quiet morning on the local corporate news front‚ but Datatec [JSE:DTC] is down 0.88% at R49.55 after it marginally lowered its revenue expectations for the year ended February 2013.

Releasing its pre-close year end trading statement on Tuesday‚ it said that compared with the Interim Management Statement issued on January 16‚ it now expects revenue to be in the range of $5.2bn to $5.3bn from the previous forecast of approximately $5.4bn.

Profit after tax is expected to be in the range of $83.0m to $88.0m from the previous forecast of $80.0m to $90.0m.

Underlying earnings per share are now forecast to be in the range of 40-45 US cents from the previous forecast of 40-47.9 US cents‚ while headline earnings per share are seen in the range 38- 43 US cents from the previous forecast of 35.0 - 43.1 US cents.  

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