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Profit-taking in resources knocks JSE

Johannesburg - The profit-taking in the resources sector of the JSE continued on Tuesday morning as the market awaited news on South Africa’s economic growth.

At midday the all share index was 270.71 points lower at 47 123, while the Top 40 index traded 260 points down at 42 621.

The main culprit was the resources index which was another 1.76% lower at midday, after shedding more that 2% yesterday.

The market was waiting for South Africa’s latest growth figures, which was eventually much better than expected.

Statistics South Africa announced shortly before midday that South Africa’s economic growth quickened more than expected to 3.8% quarter-on-quarter in the fourth quarter of 2013 after expanding by 0.7% in the third quarter.

Most of the action this morning was in the resources sector where heavyweights like Sasol [JSE:SOL] (-0.69% to R547.32), Anglo American [JSE:AGL] (-3.15% to R262.25) and BHP Billiton [JSE:BIL] (-2.05% at R345.28) all traded lower.

Imara SP Reid said in its daily market snapshot resources stocks yesterday finally reacted to the relative overbought situation which they had occupied over the last 6 to 8 trading days. The current losses represent a realistic value retracement for the sector.

The only sector in the black was the financial sector (+0.14%) where banking stocks in particular had a good run after some excellent results recently.

Imara SP Reid said the main driver for financial shares was the stronger rand which traded below the important resistance level of R10.80/$. By midday, the currency was trading at R10.76.

Overnight, the rand traded as strong as R10.75/$ in New York – the strongest in five weeks, boosted by expectations of upbeat GDP data, a market-positive budget and as dealers unwound long-dollar positions.

 FirstRand [JSE:FSR} was up 0.76% to R34.31 after the bank said it expected headline earnings per share (HEPS) to rise 22% in the six months to December 31 2013.

Construction group Aveng [JSE:AEG} was up 0.40% to R22.60 despite  reporting a 21% decline in headline earnings per share (HEPS) to 82.1c for the six months ended December 2014 from 104.5c a year earlier.

Chemicals and explosives group AECI [JSE:AFE] traded unchanged at R130 after reporting that HEPS for the year ended December 2013 were up 57% to 791c compared with 547c a year earlier.

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Rand - Dollar
19.04
-0.7%
Rand - Pound
24.02
-0.5%
Rand - Euro
20.53
-0.3%
Rand - Aus dollar
12.36
-0.1%
Rand - Yen
0.13
-0.7%
Platinum
900.15
+0.4%
Palladium
1,000.00
-0.2%
Gold
2,212.54
+0.8%
Silver
24.59
-0.2%
Brent Crude
86.09
-0.2%
Top 40
68,094
+0.6%
All Share
74,290
+0.5%
Resource 10
56,964
+2.3%
Industrial 25
103,585
+0.3%
Financial 15
16,463
-0.4%
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