JSE rises on Dow as MPC disappoints

Johannesburg - The JSE ended firmer on Thursday as a strong start on Wall Street boosted sentiment, cheering up local investors who were disappointed over the decision by the South African Reserve Bank's (Sarb's) Monetary Policy Committee (MPC) not to cut rates.

The JSE all share index gained 1.58%, as resources added 1.86%, and platinum miners surged 3.91%. Gold miners garnered 0.41%. Banks strengthened 1.78%, financials rose 1.49% and industrials edged up 1.37%.

The rand was bid at R7.44 to the dollar, from R7.52 at the JSE's last close. Gold was quoted at $1 194.85 a troy ounce from $1 192.93/oz at the JSE's previous close, while platinum was at $1 527/oz from $1 526.00/oz before.

A trader said the local market pulled back briefly after the MPC decided to keep the repo rate unchanged at 6.5% on Thursday afternoon.

The trader said the market was "disappointed" with the MPC's decision not to cut rates. 

A rally in US stocks provided support to domestic equities, the trader said. "Company reports in the US are better than expected," she said.

Dow Jones newswires reports that US stocks jumped on Thursday as better-than-expected housing numbers added to the market's cheer over a strong round of US corporate earnings and eurozone economic data.

Investors have grown concerned in recent weeks that while US corporate earnings were coming in above expectations, economic data was disappointing.

That trend improved somewhat on Thursday as existing-home sales and the Conference Board's index of leading economic indicators topped expectations, although weekly jobless claims rose more than expected.

The market was particularly encouraged by the existing-home sales, which fell less than expected, as other recent measures of the housing market have been especially weak after the government's tax rebates ended.

  - I-Net Bridge