JSE falls into familiar groove | Fin24

JSE falls into familiar groove

Jul 30 2014 14:17
David van Rooyen

The new JSE logo. (Supplied)

Company Data


Last traded 391
Change 4
% Change 1
Cumulative volume 1512430
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA


Last traded 3492
Change 23
% Change 1
Cumulative volume 870502
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA


Last traded 65
Change 0
% Change 1
Cumulative volume 7004860
Market cap 0

Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - The JSE repeated its pattern of the past few weeks on Wednesday morning, when the market was the victim of profit-taking after a strong run the previous day.

The All-share index flew past the 52 000 point level on Tuesday and closed at a new record, but by midday on Wednesday it was again 0.54% lower at 51 960 points, while the Top 40 index lost 0.60% to 46 776.

It was significant that all major indices were down on Wednesday morning, with the Financial index the hardest hit. The index lost 0.92% after Tuesday’s run when the share prices of the big four banks all at one stage hit new 52-week highs.

The Resource index, the recent frontrunner on the JSE, lost 0.60% and the Industrial index gave up 0.48%. The volatile gold index was 0.85% down despite a steady rand and gold price.

It seems investors worldwide are seeking value and are looking for buying opportunities which develop during corrections, and then selling again when the market has had a bit of a run.

Investors are also looking at Wall Street, which is becoming more jittery as the major indices have set one record after another.

The American markets closed lower due to uncertainty about increased sanctions against Russia and some disappointing company results.

Jack Ablin, chief investment officer at BMO Private Bank, attributed Tuesday's drop in stocks entirely to the sanctions, which followed mixed corporate earnings reports.

"There's always economic blowback" from sanctions, he said. "Whenever trade is restrained in any way it creates dislocations and distortions that are generally negative."

Wall Street however had no effect on the Asian markets, which ran strongly again on Wednesday morning. The Chinese market in particular is at much lower valuations than some of the major markets, and there is still room for improvement amid new optimism about the Chinese economy's prospects.

A strong Chinese economy is in the long run good news for South African commodity producers which sell to Chinese industries.

Another beneficiary is Naspers [JSE:NPN], which has access to the Chinese consumer market through the e-commerce ventures of Tencent, the Chinese internet giant in which Naspers has a stake of 34%.

Naspers however did follow the rest of the market lower after making an initial charge at the share’s previous high. By midday on Wednesday Naspers was 0.92% weaker at R1 318.01 after at one stage trading at R1 339.66, not far off the previous high of R1 354.04.

Despite the big correction in April and May, when the share price dropped briefly to below R1 000, the Naspers share price has grown by 34.1% over the last six months and 60.3% over the last year. Over the last month the improvement was 6.3%.

In the resources sector Anglo American [JSE:AGL] lost only 0.24% to R294.84 after a strong record-breaking run due to positive results. BHP Billiton [JSE:BIL], which was also trading at 52-week highs, dropped 1.13% to R372.00.

The Barclays banking group in Britain announced a rise in first-half profits due to the strong contribution from its African subsidiary Barclays Africa Group [JSE:BGA], but that did not do much for the local group's share price as it lost 1.49% to R169.74.

FirstRand [JSEFSR:] traded 2.7% lower at R43.37 and Nedbank [JSE:NED] was 2.4% weaker at R240.12. Standard Bank [JSE:SBK] lost 1.33% to R147.32.

 - Fin24

equities  |  jse  |  markets


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