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JSE trims losses on US jobs data

Johannesburg - The JSE ended the first week of trade in 2011 on a lower gear on Friday, but the local bourse managed to retreat from the day's worst levels after the release of a report showing a drop in the US unemployment rate.

Resources kept the broader market under pressure on softer commodity prices and a strong dollar, an equity derivatives trader said.

At 17:00 local time, the JSE all share index was down 0.58%, with resources sliding 1.05% and gold miners falling 0.97%. Platinum bucked the trend among mining shares, gaining 0.38%. Banks lost 1.16% and financials fell 0.65%, while industrials were flat (-0.09%).

The rand was trading at 6.78 to the dollar from 6.72 at the JSE's close on Wednesday. Gold was quoted at US$1 373.32 a troy ounce from US$1 368.94/oz at the JSE's previous close, while platinum was at $1 736.00/oz from $1 713.50/oz before.

"We had positive reaction to the US jobs data today," the equity derivatives trader said, pointing to the drop in the unemployment rate to its lowest level in 19 months. But US nonfarm payrolls data was disappointing.

Banks fell sharply as there might be profit-taking following a strong run in the past few sessions, he said.

On the day, much of the weakness came from resources counters. Metal prices have slipped from recent record levels, owing largely to the firming greenback.

Dow Jones Newswires reported that US stocks wavered on Friday as investors tried to reconcile a smaller-than-expected increase in nonfarm payrolls for December with a drop in the unemployment rate to its lowest level in 19 months.

The Dow Jones Industrial Average fell 10 points to 11 687, in early trading.

Nonfarm payrolls rose by 103 000 last month as private sector employers added 113 000 jobs, missing economists' expectations for a gain of 150 000 jobs. The November number was revised up significantly to show an increase of 71 000 jobs, from a previous estimate of 39 000.

The unemployment rate, which is obtained from a separate household survey, fell to 9.4% last month, the lowest level since May 2009 and the biggest fall in more than a decade. It beat expectations for a 9.7% rate.

Still, the unemployment rate was affected by a drop in the civilian labour force participation rate to 64.3% from 64.5%.

 

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Rand - Dollar
18.89
+0.2%
Rand - Pound
23.87
+0.1%
Rand - Euro
20.39
+0.2%
Rand - Aus dollar
12.32
+0.1%
Rand - Yen
0.12
+0.1%
Platinum
908.05
0.0%
Palladium
1,014.94
0.0%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
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