Johannesburg - The JSE stock market opened in positive territory on Friday‚ despite the rand deteriorating to R8.6213 against the greenback on Friday morning - its weakest level since early June - due to foreigners pulling their money out of SA markets because of local mining strikes.
Ironically the JSE was buoyed by a bounce in platinum counters and resources stocks.
At 09:21, the JSE all-share index was up 0.67% at 36 513.53 points‚ with platinums and resources gaining 1.68% and 1.36% respectively.
“The fall in the rand is a bad thing‚ but a lot of South African companies are benefiting from this‚ like SAB Miller‚ and our mining stocks are trading higher despite the strike troubles with Anglo American and BHP Billiton trading higher.
"It is ironic that the weaker rand is supporting our market. The rand is trading lower due to the recent Moody’s downgrade of our government bonds and due to local strikes.
"Foreigners are pulling their money out of markets and we have seen net outflow for a while now‚ but our local market is higher despite this‚” said Hennie Fourie‚ stockbroker at PSG Konsult in Pretoria.
Rand Merchant Bank said in a morning note that the strikes are spreading and there is the underlying backdrop of a large current account deficit.
“We saw runs in 1996 and 2001 based on local problems. There are many South Africans — onshore and in offshore financial centres — only too happy to panic. Foreigners have turned negative over our equities and bond inflows have been disappointing‚” the bank said.
“Strikes are nothing new in South Africa and international investors are used to the socio-political risks of emerging markets. We have learnt from history that sell-offs always reverse and our yields remain attractive and will continue to attract large inflows‚” the bank added.
“The precious metals market remains the main beneficiary of the local mine tensions‚ which propelled the platinum price to a one year high on Thursday.
"Gold is still on an upward trajectory‚ with $1 800/oz now well in sight and likely to be tested today.
"Investors will turn their attention to US employment numbers today. Consensus is for 115 000 jobs to have been created in September‚ while the unemployment rate is expected to rise to 8.2%.”
Leading European indices and were also trading in the green on Friday morning‚ with the London FTSE 100 last seen 0.32% higher. In the East the Japanese Nikkei closed 0.44% higher and the Hong Kong Hang Seng index was trading 0.47% firmer.
Among individual shares‚ Anglo American [JSE:AGL] added more than 2% to R254.78‚ BHP Billiton [JSE:BIL] was more than 1% firmer at R266.91 and Sasol [JSE:SOL] gained 1.72% to R376.40. SAB Miller [JSE:SAB] was up 1.78% at R382.68.
Gold counter Harmony [JSE:HAR] added more than 2% to R68.25 and platinum stock Impala Platinum [JSE:IMP] added 1.57% to R137.41.