JSE opens flat on strong rand
June 12, 2009
By Palesa Motloung
Johannesburg - The JSE was flat in early trade on Friday with the strong local currency weighing on the bourse in what was likely to be a lacklustre session ahead of the weekend, a Johannesburg-based trader said.
By 9.19am, the JSE all share index was flat, down 0.08 percent with resources easing 0.29 percent and gold stocks weakening 0.32 percent. However, platinum miners added 1.14 percent. Banks were flat, up 0.01 percent, as were financials and industrials, both down 0.03 percent.
The rand was last bid at R7.99 to the dollar unchanged from when the JSE closed on Thursday. Gold was quoted at $952.09 per ounce from $953.50 at the JSE's last close, and platinum was at $1 260 per ounce, from $1 261 at its previous close.
"We are flat this morning. Once again the strong currency is weighing on the overall market," a local trader said.
"The S&P failed to close above the 950 level, it has been trading in a tight range of 925-950. It's pretty much lacklustre at the moment and is likely to continue for the day. No one wants to take on fresh positions ahead of the weekend, and potentially a long weekend," he said.
South African markets will be closed on Tuesday for a holiday.
Dow Jones Newswires reported that US stocks rose and the major indices closed at or near highs for the year as interest-rate fears receded and banking stocks such as Bank of America and Fifth Third Bancorp returned to favour.
The rally wilted in the last half-hour, however, as the weakness of consumer stocks suggested growing concern about oil prices standing at a seven-month high.
The last two sessions have witnessed Treasury auctions that elicited starkly different reactions from investors. On Wednesday, rates were pushed up in order to sell 10-year notes at auction.
That caused traders to worry about the strain on a nascent recovery from rising interest rates and stocks sold off.
On Thursday, rates fell after strong demand for a 30-year Treasury bond auction. Retail sales ticked up in May and weekly unemployment claims fell.
Still, some money managers are cautious, saying the economy still faces monumental challenges, despite hundreds of billions of dollars of support from the government.
Overall, the Dow index rose 31.9 points, or 0.37 percent, to 8770.92, its highest close since January 6. After briefly popping into positive territory for the year to date during the session, the Dow is down 0.06 percent for 2009 so far.
The broad S&P 500 index rose 5.74, or 0.61 percent, to 944.89, its highest close of 2009. The technology oriented Nasdaq Composite, which has led the recent stock-market recovery, rose 9.29, or 0.5 percent, to 1862.37 after a strong showing from shares of computer-maker Dell.
Asian shares are mostly higher on Friday, taking their cue from Wall Street, with the Nikkei 225 and Hang Seng Index breaking key resistance levels.
Japan's Nikkei ended 1.6 percent higher, ending over key 10 000, and Hong Kong's Hang Seng HSI was last up 1.2 percent.
Shares in Europe are seen lower as investors continue to hope for signs the global economy is beginning to recover even amid concerns about valuations.
On the JSE, Anglo American was down R2.42, or 1.04 percent, to R231 and BHP Billiton declined R1.10 to R200. Petrochemicals group Sasol weakened 97c to R308.03.
Among gold miners, AngloGold Ashanti lost R3.29, or 1.08 percent, to R301.22, but Gold Fields collected 70c to R94.05 and Harmony inched 15c higher to R86. Platinum miner Anglo Platinum gained R10, or 1.77 percent, to R575 but Lonmin lost R1.58 to R187.75.
Among industrials on the JSE, brewer SABMiller weakened 86c to R165.65.
Banking group Standard Bank eased 15c to R84.35 and Absa weakened 40c to R101.60.
Retailer Lewis gave up R1.01, or 2.10 percent, to R47.01.
Construction group WBHO gained R2.50, or 2.35 percent, to R108.95 and Basil Read collected 15c, or 1.08 percent, to R14.
Cement manufacturer Pretoria Portland Cement was up 31c, or 1.08 percent, to R28.91.
Among telecommunications groups, Vodacom rose 64c, or 1.17 percent, to R55.54 and MTN Group collected 39c to R120.39.
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