Resources keep JSE aloft

2010-03-12 12:09

Johannesburg - The JSE was still well in the black in midday trade on Friday, kept aloft by stronger resource counters on the back of a slight recovery in metal prices.

Traders said there was also still a lot of interest being expressed in interest rate-sensitive stocks, indicating that some players could be looking for another rate cut.

At noon, the JSE all share index was up 0.73%, with resources gaining 1.04%, gold miners picking up 2.05% and platinum miners firming 0.66%. Banks pocketed 1.12%, financials found 0.97% and industrials were up 0.29%.

The rand was bid at R7.40 to the dollar, from R7.45 at the JSE's close on Thursday. Gold was quoted at $1 117.05 a troy ounce from $1 102.22 at the JSE's last close. Platinum was at $1 620.50/oz from $1 586/oz at the JSE's last close.

"The market opened firmer after the Dow saw a positive turnaround last night. And although some of the other markets are coming off again, metal prices are looking a bit better and resources are firming, so our market is firmer.

"We're also seeing a lot of interest in interest rate-sensitive stocks. So some players could be hoping for another rate cut," a local equities trader said.

Dow Jones Newswires reported that European stocks were steady on Friday, with investors continuing to keep an eye on developments in China and possible moves to dampen the overheating economy there, while a vacuum of fundamental data this week has left the markets struggling for direction.

"Europe has enjoyed a very significant move up and is close to its December/January highs, although the worries that previously weighed on markets haven't all gone away," said Adrian Darley, head of European equities at Ignis Asset Management.

"That means there is a greater risk of a pullback now than in recent weeks but, as ever, this will present opportunities for us as we look to exploit market anomalies."

Earlier this week, the FTSE 100 hit a fresh 18-month high of 5645.3, whereas its European peers are just short of surpassing the 52-week highs seen in January.

Earlier, Asian shares closed mixed in sluggish trade in many markets, although gains in exporters supported the Tokyo market.

Investors stepped back tentatively into stocks after Thursday's higher- than-expected Chinese inflation data revived concerns about further policy tightening from Beijing.

The Shanghai Composite was 1.2% lower, Japan's Nikkei 225 gained 0.8%, Australia's S&P/ASX 200 closed just 0.1% higher and South Korea's Kospi Composite increased 0.4%.

On Thursday, the Dow Jones Industrial Average rose 0.4% to 10,611.8, marking its third straight day higher and its highest closing level since January 19. The Nasdaq Composite rose 0.4% to 2368.5, its highest close since August 28, 2008. The Standard & Poor's 500 index advanced 0.4% to 1150.2, its highest close since October 1, 2008.

However, US investors noted that the week has been marked by low volumes and small movements.

- I-Net Bridge