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JSE buoyed by European markets

Johannesburg - After a shaky start, the JSE rebounded in midday trade on Tuesday, buoyed by European markets as they
extended their gains.

A trader said the local bourse will likely maintain the positive tempo as it awaits more US corporate and economic data later in the day.

By noon, the JSE All-share index had gained 0.40%. Resources picked up 0.69%, and gold producers were 0.58% stronger. Platinum miners rallied 0.31%. But banks were flat (-0.10%), with financials also flat (- 0.05%), and industrials up 0.28%.

The rand was bid at R7.55 to the dollar, unchanged from the JSE's last close. Gold was quoted at $1 206.96 a troy ounce from $1 198.41/oz at the JSE's previous close, while platinum was at $1 529.00/oz from $1 520.50/oz before.

A local trader said: "The JSE took its cue from the European markets, which pushed firmer in midday trade while Asian stocks were fairly weaker."

He added that the local market is likely to take direction from the results of US IT group Intel later on Tuesday, with US consumer confidence and trade balance data also in the spotlight.

Dow Jones Newswires reported that Asian shares closed mostly lower on Tuesday, as cheer following Alcoa's positive earnings report was dampened by losses in Chinese shares after Beijing reiterated its determination to rein in the property market.

Japan's Nikkei Stock Average closed down 0.1% and Australia's S&P/ASX 200 fell 0.7%. China's Shanghai Composite index dropped 1.6% and Hong Kong's Hang Seng index lost 0.2%, while South Korea's Kospi Composite fell 0.6%.

European stocks rose on Tuesday, helped by a solid start to the US earnings season, with autos leading the advance after BMW raised its 2010 guidance. However, the euro sank across the board on Moody's two-notch downgrade of Portugal.

Moody's credit-rating agency downgraded Portugal's long-term debt to A1 from Aa2, adding that the rating outlook is now stable.

However, traders said the downgrade came as no surprise and investors chose to focus on upbeat second-quarter results from Alcoa instead. Late on Monday, the company said it had swung to a profit and raised its outlook for global aluminum consumption this year.

"What we have generally seen over the last few days are traders betting that the US earning season will be a fruitful one and are therefore cherry-picking stocks that to them may look cheap," said Giles Watts at City Index.

  - I-Net Bridge
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Rand - Dollar
18.90
+0.2%
Rand - Pound
23.85
+0.2%
Rand - Euro
20.39
+0.2%
Rand - Aus dollar
12.31
+0.2%
Rand - Yen
0.12
+0.2%
Platinum
908.05
0.0%
Palladium
1,014.94
0.0%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
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