Johannesburg - The JSE remained in the black but
was off its earlier best levels by midday on Wednesday, but miners were
still offering support as gold touched another fresh high.
At midday the JSE all share index was 0.61% stronger, led by a 1.16%
rise in gold miners, a 1.24% jump in resources and a 1.28% advance for
platinum miners.
Banks were down 0.28%, financials were flat and industrials moved up
0.16%.
The rand was bid at 7.39 to the dollar, from 7.49 when the JSE closed on
Tuesday. Gold was quoted at $1 179.60 a troy ounce from $1 164.32/oz at
the JSE's last close, and platinum was at $1 466.50/oz, from $1 454/oz
the bourse's previous close.
International markets
Dow Jones Newswires reported that gold is defying expectations of a
pullback by making further record highs on Wednesday as commodity currencies
continue to underperform and concerns of inflationary asset bubbles
heighten.
The precious metal, traditionally viewed as a hedge against inflation,
hit $1 179.95 a troy ounce in early European trade, building on a rally that
started to gather pace a month ago.
Most actively traded Comex December gold traded up to a high of
$1 180/oz in electronic trade, up $14.20/oz, or 1.2% on Tuesday.
A local trader said that the local market was looking a bit overbought.
"We have a global recovery taking place and there is cheap credit
available in the rest of world. There is massive demand for resources and
miners right now, and that has been the main driver. That's where the big
action is right now," he said.
He added that the big momentum was coming from the funds flowing into
the market - some R73bn has been invested in the JSE by foreigners
buying. And their interest is purely in miners.
There was not much by way of corporate news this morning.
Massmart issued a trading statement in which it adopted a cautious
outlook, saying its business planning was extremely difficult because the
speed with which the global economic crisis had fundamentally changed the
environment, rendering references to the prior year "almost invalid".
For the 21 weeks ended November 22, Massmart said its total sales growth
was 4.9% and comparable sales growth was -0.7%. Excluding African sales
these growth figures were: total sales 6.2% and comparable sales 0.9%. To
assist comparison, the similarly restated sales growths for week 14, the
date of the previous Massmart sales update, would have been total sales
6.4% and comparable sales 1.8%.
"Given the critical Christmas trading period, it is difficult to
forecast Massmart's earnings with any reasonable degree of certainty, but we
expect earnings per share and headline earnings per share for the six months
to December 2009, including and excluding any foreign currency translation
effects, to be below the comparable prior period," it said.
Massmart's share price initially fell to a low of R84, but has since
recovered off its lows and was last quoted 32 cents weaker at R85.83
from a previous close of R86.15.
Another trader noted that there is a host of US data due out later in
the day and the JSE would likely tread water ahead of that.
US data due this afternoon includes October Durable Goods Orders,
October Personal Spending and Income, November Consumer Sentiment and
October New Home Sales.
Dow Jones Newswires reported Asian shares ended mostly higher on
Wednesday after a volatile session that saw many markets change direction at
least once, with Japanese stocks climbing on exporters after a strong set of
trade data for October.
Chinese stocks in Shanghai and Hong Kong overcame choppiness in early
trade to finish higher as investors snapped up shares that were beaten-down
in Tuesday's sell-off, but banks underperformed on concerns about capital-
raising.
Japan's Nikkei 225 Average rose 0.4% to 9 441.64 for its first higher
finish in six sessions, China's Shanghai Composite rebounded 2.1% and the
Hang Seng Index rose 0.8% in Hong Kong.
In London, the FTSE 100 was 0.58% higher.
- I-Net Bridge