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Resources, gold stocks weigh on JSE

Cape Town - The JSE moved mostly sideways on Friday as the technical improvement of the past few days ran out of steam.

Resources shares were more than 1% down and the free fall in gold share prices continued, but financial shares were virtually unchanged and the Industrial index was moderately higher.

In late afternoon trade, the All-share index was 0.03% higher at 51 789 points, and the Top-40 index 0.02% up at 46 312 points.

The technical analysts of Imara SP Reid said the indices are now approaching minor resistance areas after the gains of the last few days. There are still signs of residual selling pressure and the indices will have to break these.

The market also seemed to be in limbo as investors awaited clear signs as to when US interest rates will rise, which could lead to an outflow of funds from emerging markets such as South Africa.

The US gross domestic product for the second quarter was revised to 2.3% - slightly below most estimates.

Economist however think that the additional upward revision of first-quarter GDP, which was revised from a 0.2% contraction to a 0.6% increase, will give the Federal Reserve enough conviction to continue with the planned interest rate hike.

The strong dollar is already discounting such a possibility with devastating effects on the prices of commodities, particularly gold.

The Gold index pulled back from massive losses earlier to trade 2.48% lower at 788.39 points. The current level is now almost half the 52-week high of over 1 558 points reached in January this year.

Shares like Harmony [JSE:HAR], AngloGold Ashanti [JSE:ANG] and Sibanye [JSE:] are now reaching 52-week lows almost every day, with Gold Fields [JSE:GFI] just above the previous high. The biggest loser in the sector was Randgold [JSE:RNG] which traded 8.51% lower, while DRD Gold [JSE:DRD] was 4.73%lower, AngloGold 4.68% and Gold Fields  3.43% weaker.

The Industrial index is being supported from London, where shares like British American Tobacco [JSE:BTI] and Richemont [JSE:CFR] are on a run. BAT set yet another high of R752 after gaining a further 1.62% and the share price is now 6.49% higher over the past seven days.

Richemont was 1.50% higher at R109.34 after falling only 10c short of its previous 52-week high of R110.00.

In the Resources sector BHP Billiton [JSE:BIL] lost 0.39% to R230.79.


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Rand - Dollar
18.96
-0.1%
Rand - Pound
24.04
+0.3%
Rand - Euro
20.55
+0.2%
Rand - Aus dollar
12.34
+0.6%
Rand - Yen
0.13
+0.8%
Platinum
900.98
-0.2%
Palladium
1,000.76
-0.5%
Gold
2,155.89
-0.2%
Silver
24.95
-0.4%
Brent Crude
86.89
+1.8%
Top 40
65,751
-0.8%
All Share
71,995
-0.6%
Resource 10
53,013
-0.6%
Industrial 25
99,381
-1.1%
Financial 15
16,605
-0.1%
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