Johannesburg - South African stocks edged higher
in early trade on Wednesday with a weak dollar supporting commodities.
At 09:25 the JSE all share index had gained 0.45%, with resources up
1.05%, gold miners firming 1.31% and platinum producers collecting 0.78%.
Banks edged up 0.25%, financials inched 0.28% higher and industrials
were flat, down 0.03%.
The rand was bid at 7.37 to the dollar from 7.41 when the JSE closed on
Tuesday. Gold was quoted at $1 108.90 a troy ounce from $1 101.65 at the
JSE's last close, and platinum was at $1 361.50/oz, from $1 351/oz at
its previous close.
"We have edged up on the back of just-positive markets in the East.
There was also not a lot of volume in the East and in the US, I think people
think the market has run too far," a trader said.
"The dollar is still trailing against the euro and is supporting
commodity prices. Prices are stronger and that has spilled over into
commodity shares."
"There is not a lot of activity, we are up on world markets and the
weaker dollar is supporting commodities," he said.
"For the day, I don't see a lot of action. After three good days, we
might see some profit taking. I don't see any huge swings. At these levels,
we might even retract a bit," he added.
Dow Jones Newswire reported that while the broader market was weighed
down by weakness in Boeing and other industrials, a rally for Bank of
America and American Express helped the DJIA close higher for a fifth
straight day on Tuesday.
The Dow edged up 20.03 points, or 0.2%, to 10246.97, marking its highest
close since October 3, 2008. In the past five days, the Dow has tacked on
4.9%, with both traders and investors pushing into its blue-chip components
going into the end of the year.
Within the index, Bank of America tacked on 26 cents, or 1.7%, to 16.03,
after Chief Executive Ken Lewis said the bank's integration of Merrill Lynch
& Co. is ahead of schedule and will generate more expense savings in 2009
than originally forecast. In addition, American Express increased 63 cents,
or 1.6%, to 39.68, as the credit-card giant said its customers spent more in
absolute-dollar terms in October and reported billing was up 3% during the
same period.
Also helping the Dow, International Business Machines rose 91 cents, or
0.7%, to 126.91.
While the Dow finished higher, the other two broad market indexes fared
worse. The Standard & Poor's 500 slipped 0.07, or 0.01%, to 1093.01,
snapping a six-day winning streak. Within the index, industrials and
financials were weak. Financials in the index were hurt by some weakness for
insurers, including Hartford Financial, off 34 cents, or 1.3%, to 25.
For investors across asset classes, much of the expectation is for the
end of the year to remain volatile. After a slate of economic optimism had
driven industrial stocks and commodity prices higher in the past few weeks,
both areas on Tuesday gave back some of those gains. At the same time, the
US Dollar Index pushed slightly higher, bucking its recent trend.
Asian stock markets are mixed on Wednesday as investors digested recent
gains and mulled over a mixed bag of Chinese data. In Australia, property
trusts were surging after Investa Property Group abandoned its plans for an
initial public offering.
The Nikkei ended flat and Hong Kong's Hang Seng was last up 0.7%.
European shares are expected to open slightly higher after markets
struggled to make progress on Tuesday, as investors paused in their recent
buying enthusiasm.
- I-Net Bridge