Johannesburg - The JSE edged into the black in
early trade on Friday taking direction from firmer world markets as positive
momentum from company earnings continued to support bourses, a local
equities trader said.
At 09:21 the JSE all share index had collected 0.48%, with resources up
0.69% and platinum counters adding 0.68%, but gold miners gave up 0.79%.
Banks were flat, down 0.02%, financials edged up 0.12% and industrials
were 0.44% higher.
The rand was bid at 7.41 to the dollar from 7.47 just before the JSE
closed on Thursday. Gold was quoted at $1 059.15 a troy ounce from
$1 056.42/oz just before the JSE's last close, and platinum was at
$1 370.50/oz, from $1 362.50/oz at its previous close.
"We have edged up this morning. There is a lot of good company news and
the momentum just keeps going. Maybe there is some panic buyers with
investors who are missing the rally wanting to be part of it," the trader
said.
"Volumes are very high and that signals that there are a lot of inflows
from offshore investors. Risk appetite is increasing."
"The rand has weakened and commodity shares are supported. For the day,
I don't see too much. There might be some profit taking later on in the
session like we saw last Friday."
"Gold stocks are down on the weak dollar. We know that when risk
appetite comes in gold stocks are not that much in flavour," he said.
Dow Jones Newswires reports that Travelers, McDonald's and 3M paced
another round of better-than-expected earnings reports and helped the DJIA
surge more than 100 points on Thursday.
For Thursday, the DJIA closed up 131.95 points, or 1.33%, to 10 081.31,
reflecting its first gain in three sessions and a late rally that pushed the
Dow back over the psychologically significant 10 000 level.
Pacing the
index, Travelers gained $3.68, or 7.7%, to $51.70 after the commercial and
personal insurance provider's third-quarter profit more than quadrupled on
sharply lower catastrophic losses and improved investment returns. The
company also raised its full-year earnings outlook.
For the Dow, its 1.3% gain on Thursday well outpaced the other two broad
market indexes. The S&P 500 closed up 11.51, or 1.06%, to 1092.91, while the
Nasdaq Composite tacked on 14.56, or 0.68%, to 2165.29.
Since stocks have picked up from decades-long lows in the past seven
months, industry bellwethers have rarely been at the front of the market's
gains. Riskier small-capitalisation stocks paced much of the initial market
surge, while other more nuanced sectors have taken turns leading the tape.
"We've now seen a transition in the leadership in the market where you
have to watch the bellwether companies," said Quincy Krosby, chief
investment strategist at Prudential Annuities. "Investors are really paying
attention to what these companies are saying and their guidance is very
important for the market."
Asian shares are higher on Friday with the Hong Kong and China markets
leading the way as better than expected earnings on Wall Street boosted
regional sentiment. South Korea's Hynix Semiconductor though failed to get a
lift from its third quarter report.
Japan's Nikkei ended 0.2% higher and Hong Kong's Hang Seng was last up
1.5%, at highest level in more than 14 months.
European markets are likely to follow US markets higher but investors
may opt to take some prudent profit ahead of the weekend, especially should
the session's earnings and economic reports serve up any disappointment.
- I-Net Bridge