JSE bounces back after recent slide

2014-03-05 00:00

THE major indices on the JSE were approaching record levels again yesterday as investors shrugged off global woes and negative local economic news.

The rand, which traded close to R11 per dollar on Monday, also recouped some of its losses after reports that Russia ordered troops in military exercises in central and western Russia to return to base, raising hopes that a peaceful solution in the Ukraine might be reached.

The all-share index was 362,74 points stronger at 47 501 yesterday morning — it was 0,69% higher by late afternoon — and the Top 40 index strengthened 403,02 points to 42 981. Both indices were close to the records established on February 21.

The rand traded at R10,82 per dollar early in the morning after weakening to R10,90 per dollar on Monday. It was at R10,79 per dollar just before 4 pm yesterday.

Analysts said the local currency can return to its recent strength if the crisis in the Ukraine can be resolved.

On the economic front, disappointing local vehicle sales in February and a subdued Kagiso purchasing managers index (PMI), both indicate possible lower economic growth for the year.

Investors however seemed to ignore most of the outside influences and concentrated on company results which were in some cases better than expected, indicating that some valuations are supported by results.

Monday’s sell-off also opened the door for some bargain-hunting, particularly in the resources sector which improved 0.41%. Anglo American regained some lost ground and traded 0,59% higher at R269,08 yesterday morning.

Global miner Glencore Xstrata rose 2,93% to R60,51 after announcing full-year diluted headline earnings per share (HEPS) of $0,23 from $0,30.

In the platinum sector Royal Bafokeng Platinum was down 2,97% to R62,49‚ despite reporting that full-year HEPS were up 66%. The company announced a rights issue of R1,5 billion.

SABMiller was up 0,51% at R526,51 amid reports that Anheuser-Busch again intended a possible takeover of SABMiller.

Previous rumours proved unfounded and were rebuffed by SABMiller management.

Banking group FirstRand was up 0,46% to R34,65 after reporting interim earnings grew 20% to R8,7 billion.

The gold sector softened three percent yesterday on a weaker gold price and AngloGold Ashanti led decliners in the sector‚ losing 3,36% to R191.71. — Fin24 and BE.

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