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Johannesburg - The rally in the resources sector in the JSE lost some momentum on Wednesday morning, as a rampant rand put a cap on shares which earn most of their income in dollar.
Resources stocks were initially almost 1% higher, but the big conglomerates lost momentum as the rand gained 1.28% against a softer dollar to trade at R13.29 to the greenback at mid-morning, the strongest level in almost three months.
By mid-morning sesources shares were 0.25% softer, but this time there was some modest support from the financial sector which traded 0.60% higher and the Industrial index which gained a modest 0.35%.
As a result the All-share index was only 0.24% higher at mid-morning at 53 508 points, while the Top 40 index was 0.24% stronger at 46 584 points.
The resources sector, which before Wednesday’s trade was already more than 17% higher over the past 90 days, had until now been driven mainly by strong gains by the big commodity conglomerates, but on Wednesday it was the smaller shares which performed the best.
There was again strong demand for Kumba [JSE:KIO], which gained 7.14% on Wednesday to a new 52-week high of R187.49. The share price gained more than 500% over the past 12 months, but hardly moved at all over the past month.
Assore [JSE:ASR] and Exxaro [JSE:EXX], which both have interests in the iron ore industry, were also higher. Assore gained 4.42% to a new 52-week high of R284.49 and Exxaro was 4.23% stronger at R110.10.
Platinum shares have also been performing better over the past month, but are still lower for the past 90 days. The shares followed the modest moves of the platinum price, which gained more than 3% over the past month but is still more than 5% lower than three months ago. Platinum on Wednesday was 0.77% stronger at $987.00 per ounce, and the Platinum index gained 2.2%.
Impala Platinum [JSE:IMP] was at one stage more than 5% stronger but at midday was 2.69% up at R56.48. The share gained more than 28% over the past month but is still more than 15% lower than three months ago.
Anglo American Platinum [JSE:AMS] is almost 7% lower than three months ago, but has gained more than 26% over past months and added 3.05% on Wednesday morning to trade at R360.42.
One of the star performers was the diamond producer Trans Hex [JSE:TSX], which gained more than 9% to R5.25 on news of rising demand for diamonds. De Beers on Tuesday reported that its latest diamond sale was one of the most successful in a long time.
Trans Hex has been recovering steadily lately and is now 16.23% stronger over the past 30 days and 26.9% over the past ninety days.
The big conglomerates reached new 52-week highs in early trade but gave up all those gains by mid-morning. Anglo American [JSE:AGL] was 0.40% softer at R229.19 and BHP Billiton lost 1.67% to trade at R245.25.
In the Industrial index, Naspers [JSE:NPN] gained 0.50% to R2 177.00 but in early trade was as high as R2 200.
Steinhoff [JSE:SHF] and Shoprite [JSE:SHP] are still drifting lower as investors are not excited by proposals to join the groups into a big retail conglomerate. Steinhoff, which lost 7% since the news about the proposed merger became known, was 1.42% lower at R68.69. Shoprite, which lost 11% over that period, was 0.29% softer at R171.06.
