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Gold, platinum stocks gain but JSE down as global markets weaken - BDlive

Wednesday, 22 July 2015

Rand picks up due to marginally softer dollar against euro Bonds stable as market mulls rate hike South Africans look set for minor fuel price drop in August THE JSE closed slightly weaker on Tuesday in mixed trade as gold and platinum stocks made something of a recovery, while the broader...shed 1.08% to R671.29. After being sold off strongly on Monday, Gold Fields firmed 5.24% to R36.15 and local producer Sibanye regained 2.57%

THE JSE closed slightly weaker on Tuesday in mixed trade as gold and platinum stocks made something of a recovery, while the broader market was pulled down by softer global markets.

The JSE seesawed for most of the day, lacking clear direction ahead of Thursday’s local rate decision by the Reserve Bank. Economists are divided with some foreseeing a 25-basis-point hike, while many others are predicting the repo rate will remain unchanged at 5.75%.

Asian markets were firmer on the day, with the Shanghai Composite up 0.64%, but the Dow was 0.85% down at the JSE’s close. By the same time the Paris CAC 40 was 0.64% lower and the German Dax had lost 1.03%.

Barclays Research said amid a dearth of data or events, the market was following the dollar, which weakened slightly overnight. European equity markets generally failed to follow the positive lead from Asia.

"The dollar, however, has appreciated about 2.5% over the past week as a near-term Greek resolution has allowed investors to refocus on relative fundamentals — a dynamic we think should support further dollar gains."

Barclays said the gold price recovered, but despite some recent consolidation, commodity prices remained weak.

At 5pm the all share closed 0.16% lower at 52,901.40 and the blue-chip top 40 had lost 0.28%. The gold index rose 2.7% and platinums ended the day 0.77% up. Financials dropped 0.45% and banks were down 0.14%. Industrials softened 0.13% and resources were 0.1% lower.

Afrifocus Securities portfolio manager Ferdi Heyneke said some mining stocks had risen strongly on the day, despite the disappointing results from Kumba Iron Ore earlier. Low commodity prices and costs remained a big challenge.

"Miners generally attempted to recover from Monday’s rout but the stronger dollar continues to apply pressure on commodities," he said.

Retailers seemed to shrug off a possible rate hike on Thursday as the market also prepares itself for the eventual reality of US rate hikes this year.

"It remains a difficult market for miners and it may be too early to call it a bottom at present levels," Mr Heyneke said.

Market focus was on iron ore miner Kumba, which in the morning reported headline earnings per share for the six months ended June 2015 decreased to 7.85c from 20.24c in the year-earlier period.

But at the close it received some support, closing marginally up by 0.19% to R122.80.

Among the mining houses Anglo American was 1.73% lower at R165.15.

ArcelorMittal was one of the mining stars on the day, soaring 6.9% to R15.50.

Rand hedge SABMiller shed 1.08% to R671.29.

After being sold off strongly on Monday, Gold Fields firmed 5.24% to R36.15 and local producer Sibanye regained 2.57% to R17.95.

In the platinum sector Impala was up 2.23% at R49.98 and Anglo American Platinum rose 0.45% to R260.67, despite announcing a delayed decision on the disposal of two large mines in the Rustenburg area.

Banks were mixed, with Nedbank gaining 1.54% to R257.80, while Standard Bank shed 0.63% to R156.75.

Among retailers Pick n Pay lifted 1.02% to R59.30, while Cashbuild softened 2.74% to R320.

Stellar Capital Partners rose 8.27% to R2.75 and Cadiz Holdings shot up 13.48% to R1.60. Both companies are involved in restructuring exercises as retail magnate Christo Wiese increases his presence in the niche industrial and financial sectors.

Unsecured lender Finbond dropped 2.25% to R3.91.


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