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Johannesburg - Investors on the JSE took a breather on Thursday after the strong gains over the past few days offered some opportunities for profit-taking.
The profit-takers however did not have the upper hand by midday, at which time the major indices had hardly moved.
Technical analysts warned before the start of the day’s trade that short-term strength could be used as an opportunity to partially book profits on some shares which have enjoyed particularly brisk advances.
The All-share index gained 6.44% over the past seven days, with the Industrial index on a new all-time high.
By midday on Thursday the All-share index was only 0.08% higher at 52 607 points, and the Top 40 index was only 0.03% stronger at 47 178 points.
The main driving force over the past two months has been the Industrial index, which closed on a new all-time high on Wednesday. The index hardly moved on Thursday morning but by midday was another 0.03% higher at 69 927 points.
Since August 27 when the Industrial index traded at 61 104 points, it has gained more than 8 000 points or 12% with a fair share of help from SABMiller [JSE:SAB]. The stock is trading almost 24% higher than a month ago, boosted by a series of offers by the world’s brewing giant Anheuser-Busch InBev.
The latest and highest offer was rejected on Wednesday afternoon by SABMiller’s board as inadequate and undervaluing the company, but it seems speculators did not think that AB InBev had thrown in the towel.
READ: SABMiller’s bid rejection lacks credibility - AB InBev
At midday SABMiller’s share price was 0.93% higher at R753.83. The share price is however still some way off the all-time high of R782.00 reached on October 1. SABMiller was again the busiest share in terms of value.
A few other heavyweights in the industrial sector have also been trading at all-time highs recently and made more modest improvements on Thursday. Three companies in the Rupert stable all traded at new highs.
British American Tobacco [JSE:BTI], which made steady rather than spectacular progress lately, gained 1.17% to R774.66, beating the previous high of R765.89. The share gained almost 10% over the past 30 days. Its stable mate Richemont [JSE:CFR] was 0.62% higher on a new high of R113.90; the share is now 6% higher over the past seven days and 16% over the past 30 days.
Reinet [JSE:REI], the investment company in the Rupert stable, has also crept steadily higher over the past few weeks, gaining 7% over the past 30 days and 14.08% over the past 90 days. On Thursday morning it was 2.56% higher at midday on a new high of R30.49.
Bidvest [JSE:BVT] also made steady progress over the past 30 days, gaining more than 14%, but the run came to an end on Thursday. The share price initially reached a new high of R346.15, but then profit-taking started and at midday the stock was 0.71% lower at R341.24.
The Resources index was 1.02% higher by midday, but some of the resources stocks which have made strong recoveries over the past week lost momentum in the morning. Anglo American [JSE:AGL], which gained about 18% over the past week, was only 0.41% higher at R138.03.
Glencore [JSE:GLN], which on Wednesday closed about 60% higher than its 52-week low a week ago, gave up some of those gains in morning trade. By midday the share price was 2.93% softer at R25.20. The Bank of Africa warned on Thursday that big banks may be under pressure because of their exposure to Glencore’s debt.
