Isra-Mart srl: JSE opens up despite Asian markets

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Despite weaker Asian markets on persistent concerns about eurozone debt and US growth, the JSE - and some European markets - managed to eke out small gains in early trade on Tuesday.

By 09:23 local time, the JSE all-share index was up 0.45%, with resources adding 0.70%, platinum miners gaining 1.25% and gold miners up 0.50%. Banks added 0.71%, financials garnered 0.44% and industrials collected 0.24%.

The rand was bid at 7.11 to the dollar, from 7.12 at the JSE's close on Monday. Gold was trading at US$1,906.85 a troy ounce from US$1,896.10/oz at the JSE's previous close after earlier hitting a fresh record high of $1,921/oz. Platinum was at US$1,883/oz, from US$1,877/oz previously.

A local trader said that the JSE had already started reacting negatively to the poor US jobs data last Friday afternoon. As the Asian markets were shut at that time, they had fallen sharply on Monday, in a catch up reaction to the data.

“Yesterday the JSE was down (2%), but not as much as some other markets. Our top 40 shares are starting to run up - they are coming into good value levels. The gold shares are steady as well and that is helping the top 40.

“The global markets have been hit hard - but we might even find the overseas markets will drift up today. Even though the Dow futures are still in negative territory, they are recovering from their lows,” he said.

He added that although he expected the volatility in the markets to continue for some time, he was not surprised to see a rally.

He pointed out that the Dow futures were down as much as 270 points at one stage earlier today, and they are currently just 166 points lower. “So they have come back quite nicely,” he said.

The Nikkei closed down 2.21%, Australian shares closed down 1.6%, but in Hong Kong, the Hang Seng was off just 8 points. In London the FTSE was last 21 points higher.

On the JSE, Anglo American (AGL) added 2.23 rand to 275.23 rand, while BHP Billiton (BIL) was up 90 cents to 223.49 rand.

Sasol (SOL) added 2.85 rand to 322.98 rand.

Among gold shares, Anglogold Ashanti (ANG) added 1.19 rand to 330.14 rand and Gold Fields (GFI) collected 95 cents to 118.95 rand and Harmony (HAR) was 24 cents firmer at 97.49 rand.

In platinum stocks, Amplats (AMS) collected 6.92 rand, or 1.31%, to 535 rand, while Impala Platinum (IMP) garnered 2.15 rand, or 1.25% to 174.66 rand.

Northam (NHM) jumped 97 cents, or 2.93%, to 34.10 rand and Aquarius was 1.20 rand, or 4.58% better at 27.40 rand.

In the industrial sector, BAT (BTI) advanced 83 cents to 310.36 rand, while Bidvest (BVT) advanced 1.42 rand to 152.69 rand.

In banks and financials, ABSA (ASA) collected one rand to 136.80 rand, Standard Bank (SBK) added 53 cents to 96.07 rand and Firstrand (FSR) was up 20 cents, or just over 1%, to 20.06 rand.

In a quiet morning on the corporate news front, diversified industrial company KAP International Holdings (KAP) reported diluted headline earnings per share of 24.7 cents for the year ended June from 21.0 cents a year ago. HEPS from continuing operations rose to 32.7 cents from 22.7 cents.

Revenue from continuing operations was 10% higher at 4.22 billion rand, while operating profit before restructuring costs improved by 34% to 265.9 million rand.