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Johannesburg - The JSE started a touch higher on Thursday as
investors sought caution ahead of the week's EU meetings.
A local trader said: "People are still waiting to see
how the summit will pan out. There is optimism that there's going to be some
firepower coming out of the EU summit".
It looked like a muted morning, with investors waiting on a
greater news flow according to the trader.
At 09:11 local time, the All Share [JSE:J203] index was up
0.23%. Gold shares rose 0.49%, resources increased 0.36% and platinum rose
0.13%.
Banks were 0.27% lower, industrials lifted 0.22%, while
financials were flat (-0.07%).
The rand was bid at R8.04 to the dollar, from R8.07 at the
JSE's close on Wednesday. Gold traded at $1 738.86 a troy ounce from $1
733.09/oz at the JSE's previous close, while platinum was quoted at $1
517.50/oz, from $1 514.50/oz at the previous close.
Dow Jones Newswires reported that stock markets in the Asian region were mostly lower "as investors tread cautiously ahead of this week's key meetings in Europe," noted Stan Shamu, strategist at IG Markets. "A report suggesting the Group of 20 was considering a $600bn International Monetary Fund lending programme saw US markets charge higher late in the session. However, the IMF has since denied the report, which resulted in US stocks retreating in the last moments of trade. The lack of concrete proposals leading up to the summit has left investors growing increasingly pessimistic."
French and German officials on Wednesday said they are
confident that several European Union nations, in addition to the 17 members of
the eurozone, will sign up for greater central supervision of their national
budgets, even if they have little optimism of rallying all 27 EU countries.
EU nations that decide to opt out of the fiscal pact
proposed by France and Germany risk being stigmatised by investors, who could
decide to shun debt issued by countries that have rejected tighter collective
discipline, the officials said.
The European Central Bank was reported to be considering
measures to encourage lending by banks, including loosening collateral criteria
and offering longer-term loans, with reports citing three eurozone officials
with knowledge of policy-maker deliberations.
Additionally, an interest-rate cut on Thursday by the
central bank is likely, with the size of the cut left for deliberation, two of
the officials said. Still, markets showed little reaction to the reports,
continuing to reel at the prospects of an under-delivery by policy makers on
Friday.
European bourses are likely to start a bit higher.
