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    Equity markets fairly flat; focus on US Fed’s interest rate decision

    Local Markets

    The JSE opened fairly flat this morning as Asian markets reflected mixed performances and the rand’s strength limited gains on the bourse. The market looks bound to a narrow range today with little data emerging to give direction. The rand’s strength after the interest rate was left unchanged yesterday is still restraining resources and other stocks from extended gains. The market looks set to stabilise around the 25000 – 26000 level. At noon, the All Share had fallen 0.17%.

    The rand was relatively unmoved from overnight levels on open this morning. Traders are merely tracking the dollar ahead of tomorrow’s public holiday. The local currency received support from the SARB’s decision to leave interest rates unchanged. Impetus was also maintained via the resurgence in the gold price, positive US equities and improvements in the impending MTN-Bharti deal. At noon, a dollar cost R7.35.

    The gold price regained some ground over recent sessions. As physical demand in Singapore and other importing countries increases, the metal’s appeal as a safe-haven asset is re-affirmed. By midday, a troy ounce traded for $1013.53.

    International Markets

    Stocks in the US gained for the second day in a row on Tuesday. The consensus among traders was generally that the US Federal Reserve will continue its accommodative policy in order to bolster economic recovery. The Fed began its 2-day meeting yesterday, with its policy statement due out later today. Gains were broad-based although growth-sensitive sectors like financials, technology and industrials benefited from the interest rate expectations. Resource and energy stocks also received support form resilient commodity prices as the US dollar weakened again. By close the Dow Jones had gained 0.52% whilst the Nasdaq finished 0.39% higher.

    Japan’s markets were closed for the last of the 3-day national holidays on Wednesday.
    Shares in Hong Kong closed slightly lower this morning on expectations that the US Fed will keep interest rates unchanged and as investors began to discount pharmaceutical corporation Sinopharm’s debut gains. The market is fairly flat though with little direction from any major source. The benchmark Hang Seng closed 0.49% lower.

    Britain’s top share index climbed higher in early trade this morning as commodity-backed stocks benefited from a resurgence in global commodity prices and investors remained optimistic over global economic prospects ahead of the US Fed’s rates decision due out later today. There is still concern that the market may have run ahead prematurely and future growth will be limited but for the moment, investors are bullish. The FTSE 100 has gained nearly 50% since its 6-year low reached in March this year. By midday, the FTSE 100 had gained 0.50%.

    Share Price News

    Gijima Ast Group Ltd of the Computer Services sector was certainly the morning’s biggest gainer. This is a good achievement in a session marred by bearish reluctance to buy. It gained 12.36% to sell for R1.00 per share at midday. Also performing well was Super Group Ltd of the Shipping and Ports sector. It improved by 8.74% to trade for R1.12 per share at noon.

    Among the losing shares was Liberty International Plc of the Real Estate Investments Trusts sector. At midday, a share traded for R63.20 (a 7.43% loss). Of the Gold Mining sector, Simmers and Jack Mines Ltd continued to lose ground over concerns over market manipulation, concerning its equities, earlier this month. At midday, it had shed 4.88% to sell for R1.95 per share.

    Permalink2009-09-23, 12:30:11, by Grant Leyland Email , 1 comment
    Trackback address for this post: http://blog.sharenet.co.za/htsrv/trackback.php/1467

    Comments, Trackbacks:

    Comment from: reporter.shareholder [Visitor] Email
    The Super Group share price makes no sense, I can only conclude that the share price is being manipulated to make the takeover bid / life line look bad. Volumes are extremely thin below the average move therefore can not be taken into consideration.
    PermalinkPermalink 2009-09-23 @ 14:07

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