SA shares extend record-setting spree

2012-01-27 07:51

The All-Share Index hit a record high yesterday, after more than a week of pushing to new highs almost every day.

The All-Share Index, the main measure of the JSE, surged to 34 015.38 yesterday with investors looking for higher yields from emerging markets, supported by the US Federal Reserve’s announcement that interest rates would remain near zero through 2014.

The gains have also boosted the rand, which is trading around a two-month high against the US dollar at R7.81 at the close of business, compared to a low of R8.61 in November.

The surge on the JSE follows the trend among emerging markets, said Nick Kunze, the head of trading at Barnard Jacobs Mellet Securities.

“Last night’s commentary from the Fed once again put the fire under risky assets and in particular emerging markets,” said Kunze.

“One quick look at the South African rand will show that foreign money continues to dominate markets like ours, and resources should be a direct beneficiary of the Fed’s stimulus programme,” he added.

The index opened at 33 650 and hovered around 34 050 around midday yesterday.

The blue chip Top-40 index closed at 304.85, up 1.37%.

“For now local fund managers can enjoy the flows, but at some stage the strong rand will start to hurt,” said Kunze.

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