Industrials Make Solid Recovery
March 29, 2011
The broad measure All Share Index climbed 56 points to 6684, fueled by a 109-point rise in the Industrial Index to 7897. The All Gold Index slumped 36 points to 1808. Early futures interest lifted the stocks to an opening 80-point gain. Relieved that the Dow Jones Industrial Average had ended Tuesday in positive territory, investors began buying again, traders said. But with only 371 million rand in shares trading hands, activity was subdued. A late flurry of buying in the last hour of local trading, sparked by opening equity strength in New York, drove the industrial board more than 40 points higher in a gyrating trading pattern. All eyes remain focused on Wall Street, traders said. Among active stocks, banking group First National Bank Holdings rallied 1.55 rand to 28.05, construction stock Group Five soared 1.25, or 13%, to 11.00 rand and tobacco and luxury goods purveyor Richemont jumped 3.50 rand, or 5.5%, to 67.50, with much of the interest centered from its Swiss base. Gold share prices were upset by a strengthening rand and a general switch by investors into advancing industrial shares. The dollar retreated more than four cents against the rand to 4.3895, triggering an exodus from gold shares. Gold analysts await the outcome of Thursday's quarterly gold results from Anglo American, the world's largest gold producer. In the past week, reported earnings from two other South African mining houses, Gold Fields and Gencor, have been described as disappointing, and analysts feel that if Anglo is unable to match expectations, a hefty sell-off could transpire. Among losing stocks, Gold Fields fell another 4.00 rand to 119.00, and Kloof slipped 1.25 rand to 43.50. Remarking on the latest gyrations on the New York Stock Exchange, London-based investment house Syfrets International said U.S. equities were still overvalued despite recent steep losses. The anticipation of a rise in official U.S. short-term interest rates and poor corporate returns has left Wall Street vulnerable to a further fall of 5% to 10%, Syfrets International said.
VastPress 2011 Vastopolis
