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Major JSE indices hit further new highs

Johannesburg - Share prices on the JSE were on the run again on Thursday morning, with the two major indices again at new highs. Share prices increased over a wide front with most sectors higher by midday.

Disappointing retail figures earlier this week raised new concerns about the health of the US economy. Investors now seem quite certain that US interest rates will definitely not rise soon this year, if at all, and this gave emerging markets a boost.

With interest rates worldwide at record lows, foreign investors will continue to chase higher yields on markets like the JSE. Most of the double-listed shares on foreign investors' shopping lists performed solidly on Thursday morning. Lower US interest rates also put pressure on the dollar and that gave resources shares a boost.

By midday the All-share index was again 0.52% higher on a new high of 53 997 points, earlier even trading above 54 000 for the first time when it reached an intraday high of 54 094. The Top 40-index also opened above Wednesday’s record and gained another 0.59% to a new record of 47 731.

Among the major sectors, the Resources index gained another 0.79% on Thursday morning. The Industrial index was 0.65% higher at 68 542, less than a hundred points lower than the previous high of 68 608 set earlier this week, before it was pulled by down some profit-taking in Naspers [JSE:NPN] shares.

The profit-taking with Naspers shares stopped on Thursday morning and the share traded 1.86% higher at R1 883.04 after it reached an intraday high of R2 229 earlier in the week. Shares to the value of R1.5bn were sold in more than 5 000 transactions.

Sasol [JSE:SOL], which is now regarded as an industrial share, was again one of the star performers in the sector after the oil price strengthened even further. By midday Sasol traded 4.07% higher at R479.88 and has now gained more than 10% over the past seven days.

By Thursday midday the price of Brent crude oil was another 4% higher at $62.98 as the market anticipates that a drop in US shale oil production will reduce the oversupply in the oil market.

READ: Brent crude oil hits 2015 high as US output slows

SABMiller [JSE:SAB], which has been drifting sideways for the past month, improved by 2.34% to R656.89. The international group reported a marginal rise in full-year beverage sales volumes and said its results were hurt by the strength of the dollar against various currencies. The volume of lager sold rose 2% in the fourth quarter, while soft drinks volume grew 8%.

READ: SABMiller's beverage volumes rise marginally

The big surprise over the last two days is the strong performance by the resources sector, which improved by almost 2.5% on Wednesday. Imara SP Reid said in its daily Market Snapshot that further gains for resources shares are indicated by technical factors rather than an improvement in fundamentals.

Fundamentals can however improve if pressure on the dollar continues, as technical charts for the first time in a long period show signs that the dollar is facing resistance levels.

BHP Billiton [JSE:BIL], which also benefits from the higher oil price, was 0.70% higher at R266.09, but Anglo American [JSE:AGL] did not share in the upward momentum of the resources sector and lost 1.16% to R186.80. Anglo is still 4.7% higher for the past week.

Anglo’s two biggest subsidiaries in South Africa, Anglo American Platinum (Amplats) [JSE:AMS] and Kumba Iron Ore [JSE:KIO], both strengthened on Thursday morning. Amplats gained 3.71% to R296.60 while the beleaguered Kumba was 1.31% higher at R130.69. Kumba is however still 41.35% lower for the past month.

Bloomberg filed this video report on SABMiller:

          
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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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