JSE firms in line with global markets

| Thursday April 15, 2010 00:00

By mid-morning Tuesday, the JSE all share index was up 1.06 percent, with resources 1.71 percent better, gold miners up 2.16 percent and platinum miners 2.07 percent stronger.

Banks were 1.08 percent firmer, financials added 0.73 percent and the industrial index picked up 0.54 percent.

The rand was bid at 7.26 to the dollar, from 7.29 at the JSE's close on Tuesday. Gold was quoted at US$1,155.26 a troy ounce from US$1,145.90/oz at the JSE's last close. Platinum was at $1,724/oz from $1,705.50/oz at the JSE's last close.

A local trader said resources and miners were strong as the gold price ticked up.

'Across the board stocks are looking quite a bit firmer. Even banks and retailers are having a good start to the day. We were looking pretty dismal towards the close yesterday [Tuesday], but the Dow closed positively last night and Asian markets are a little firmer this [Wednesday] morning, so it's a nice strong start. There is still some nervousness as we approach technical levels, but if these are broken, the strength could carry on,' the trader added.

Dow Jones Newswires reported that Intel's encouraging results report overnight should inspire some buying in techs yesterday, but may fail to elevate the broader markets beyond a mildly higher opening.

For yesterday's opening, IG Markets called the FTSE up 11 at 5773, the DAX up 31 at 6262, and the CAC up 19 at 4051.

Stephen Taylor, strategist at Dolmen Stockbrokers, said, 'Given the run we've had, the earnings have got to be pretty good (for gains) to continue.' With most of the major equity markets having risen by about 4% in the last three months, many investors think there may be some consolidation as markets look overbought, at least in the short term. 'With the EU quelling the Greek liquidity crisis and broader risk markets looking damp on stretched valuations...the market is nervously looking around for the next microcredit trigger,' said Lena Komileva, head of Group of Seven market economics at Tullett Prebon. 'The market is correcting gently for the moment, very reasonably' after recent sustained gains, said Arnaud de Champvallier of Turgot Asset Management in Paris.

'For the moment, we are marking time. We will likely get a flat consolidation or a fall of about five percent which will allow the market to establish a base for further gains,' he said.

Wall Street futures are slightly higher on the Intel report, after U.S. stocks edged up for the fourth-straight session Tuesday despite a disappointing first-quarter report from Alcoa, as a drop in crude-oil prices helped boost consumer-discretionary companies. The Dow closed up 13 points overnight.

Shares of Intel Corp. climbed nearly 4 percent Tuesday evening, and shares of CSX Corp. rose as quarterly results from the world's largest chip maker and the railroad operator surpassed Wall Street's expectations, reflecting increased demand among their customer bases.

Intel posted its strongest first quarter in its history, helped by strong demand for its new line of chips and a return of business spending on technology. Quarterly profit nearly quadrupled, beating analysts' projections, while revenues and gross margins were also well above expectations.-Asian stock markets were mostly mixed to slightly higher yesterday with technology stocks leading the gainers after the strong results from technology giant Intel Corp.

The Nikkei closed up 0.4 percent, while in Hong Kong, the Hang Seng was last 0.37 percent higher. (Businessday)