JSE closes higher‚ gold miners weigh

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The JSE board in Sandton in Johannesburg. Photo: Leon Nicholas.

The JSE closed in positive territory on Thursday‚ well off its lows of the day‚ amidst the gold mining and platinum sectors shedding value after mineral production figures were released by Stats SA on Thursday‚ with gold production tumbling 11.1% in September compared to September last year and platinum production plunging 17.8% in September‚ due to the mining strikes in both sectors.

Total mineral production dropped 8.3% in September.

At 5pm‚ the JSE all share index closed 0.32% higher at 37‚592.86 points with the top 40 index adding 0.33%‚ while the gold and platinum indices shedded 1.74% and 1.33% respectively. Industrials added 0.67% with opportunistic buying seen in this sector on Thursday.

“The gold mining production figures were particularly poor - down 11.1% year-on-year in September - and this has weighed severely on gold mining stocks. The impact of the strikes are now coming through and it had a knock-on effect on the platinum sector. Lower platinum production figures also weighed on the platinum sector‚” said Mohammad Nalla‚ head of strategic research at Nedbank Capital.

“AngloGold Ashanti came out with poor results today and the mine has missed production targets and it does not look like the company will make it up soon‚ with them losing 250‚000 ounces of gold due to the strikes‚” he added.

“It seems like the JSE is ignoring internationally worries about the looming fiscal-cliff — tax increases and spending cuts in the US — and uncertainty surrounding that‚” he added.

Major European bourses were also trading higher with the UK’s FTSE 100 seen 0.23% stronger at 5pm with stocks there maintaining gains after the European Central Bank and the Bank of England both left key interest rates unchanged‚ as were expected. European markets also moved higher after a well-received Spanish debt auction gave investors reason for optimism.

US stocks rose‚ with the Dow Jones Industrial Average rebounding from its steepest tumble in a year on Wednesday‚ as firm labour-market and export data offset lingering worries about US politicians’ ability to strike a budget deal‚ Dow Jones Newswires reported.

At 5pm local time the Dow industrial index was seen trading 0.2% higher‚ after the Dow slumped 2.4% on US election day‚ the biggest drop since 9 November 2011‚ as investors turned their attention to the looming fiscal cliff and its mix of tax increases and spending cuts at the start of next year if a budget deal is not reached.

Among local individual counters that moved‚ AngloGold Ashanti (ANG) closed 3.69% lower at R288.94‚ after the company said it cut its capital expenditure plans for this year by $200m because of illegal strikes and the company announcing adjusted headline earnings per share down to $0.61 for the last quarter from $0.65 previously.

GoldFields (GFI) dipped 0.68% to R111.62‚ while Harmony (HAR) added 2.19% to R73.89.

Among platinum counters‚ Lonmin (LON) shed 2.40% to R64.22 and Impala Platinum (IMP) lost 1.57% to R154.00.

Industrial companies AECI (AFE) added 6.36% to R79.45 and Compagnie Richemont (CFR) gained 2.20% to R59.37. - I-Net Bridge


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