Johannesburg - Strong commodity counters and a
firm opening on Wall Street saw the JSE end 494 points higher on Monday in
what an equities trader said was offshore buying pushing the local bourse
higher.
At 17:00 the JSE all share index was 1.84% higher, with resources adding
2.64%, gold producers firming 2.59% and platinum miners up 3.47%.
Banks gained 1.29%, financials collected 1.09% and industrials moved
1.31% higher.
The rand was bid at 7.47 to the dollar, from 7.55 when the JSE closed on
Friday. Gold was quoted at $1 170.60 a troy ounce from $1 140.75 at the
JSE's last close, and platinum was at $1 472/oz, from $1 433/oz at its
previous close.
"We ended firmly higher today, we had a very, very good day," the trader
said.
"The US opened positively and that pushed our market higher. It's more
on offshore buying, especially in the resource sector.
"The weak dollar is supporting the commodity prices. Offshore investors
are playing into our market and that is pushing the bourse firmer," he said.
Dow Jones Newswire reported US stocks rose early on Monday, as gains in
commodities boosted the energy and materials sectors, and the dollar fell
after a Federal Reserve member said the US should continue buying mortgage-
backed securities past the first quarter of 2010.
The Dow Jones Industrial Average was up 133 points, or 1.3%, to 10 455 in
early trading.
All 30 Dow components are up. Its materials and energy components had
the biggest percentage gains, with Chevron up 2.2%, Alcoa up 2.1% and Exxon
Mobil climbing 1.4%.
The technology-heavy Nasdaq Composite climbed 1.2%. The Standard &
Poor's 500 also rose 1.2%, led by its energy and materials sectors as crude
oil futures climbed above $79 a barrel and metals futures rose, with gold
moving to $1 165.80 an ounce after reaching a record of $1 171.
Meanwhile, the dollar fell against both the euro and the yen, helping
push the Dollar Index - which represents the dollar against a basket of
six other currencies - down 0.9% recently. That marks a reversal of the
trends from late last week, when stocks fell as investors shied from riskier
parts of the market.
The action came after Federal Reserve Bank of St Louis President James
Bullard said on Sunday that the US should continue buying mortgage-backed
securities past the first quarter of 2010, when asset purchases are due to
end. That helped offset worries from Friday, when the eurozone central bank
announced its first step in making it tougher for commercial banks to get
loans.
"People are worried about what happens to housing once all the
government help falls away, so [the Bullard comments] are certainly part of
the mix giving a lift this morning," said Bill Stone, chief investment
strategist at PNC Wealth Management.
At the time the JSE closed, the Djia had gained 1.38%.
- I-Net Bridge