JSE flat, awaits euro rate news

The JSE was fairly flat in noon trade on Thursday‚ with everybody waiting for the European Central Bank (ECB) and the Bank of England (BoE) to announce an anticipated 25 basis point rate cut and stimulus measures‚ respectively.

Both the ECB and the BoE have policy rates at record lows of 1% and 0.5% respectively.

“Both could cut their rates‚ or just one could‚ or possibly neither‚” said Martin Strauss‚ local trader at PSG Konsult. “The market is expecting a cut and monetary easing‚ which would send a positive signal to the markets and hopefully we will see some positive market reaction.”

Locally bank shares were trading lower on Thursday‚ after having gained a bit on Wednesday. This was due to the market having already factored in an ECB rate cut. But‚ there have been negative banking headlines lately‚ such as the Barclays Libor debacle as well as Absa's profit warning at the beginning of the week‚ which added to banking stock woes.

Other data out on Thursday that will affect markets are the US non-manufacturing ISM figures this afternoon and Friday's US non-farm payrolls‚ a leading gauge of the health of the US labour market; the official US unemployment rate is also due on Friday afternoon.

Standard Bank said in a note that the ECB was widely expected to deliver a rate cut‚ which would take the refi rate down to 0.75%‚ while the BoE is expected to announce another GBP50bn of quantitative easing.

“These expected moves will follow other‚ more recent efforts to prop up growth through easing constraints in the banking system. The BoE recently enacted its enhanced collateral term repo‚ a six-month GBP5bn-plus repo that will be conducted each month at a minimum rate of the base rate plus 25 basis point‚ while the ECB recently announced that more asset-backed securities would be eligible for liquidity-providing operations by the ECB alongside more residential mortgage-backed securities‚” the bank said.

At 11:43 local time‚ the JSE all-share index was 0.24% higher at 34‚121.22 points‚ with resources up 0.10% and gold shares garnering 0.46%; platinum counters edged up 0.58%.

Financials slipped 0.17‚ banking stocks shed 0.50% and industrials firmed 0.52%.

The rand was trading at 8.15 to the US dollar‚ from 8.14 at the JSE's close on Wednesday‚ while gold was trading at US$1‚617.55 a troy ounce from US$1‚614.79/oz at the JSE's previous close and platinum was quoted at $1‚487.20/oz‚ from $1‚483/oz previously.

Meanwhile‚ at about noon local time the FTSE 100 was up 0.29% as investors sat on the sidelines ahead of the Bank of England's rate and asset-purchase target announcements at 11:00 GMT.

Hong Kong shares ended Thursday at an eight-week high on expectations of easing measures from Europe and China‚ with China-related stocks leading the day's gains‚ Dow Jones Newswires reported. The blue-chip Hang Seng Index rose 0.50%‚ to 19‚809.13‚ its highest closing level since ending at 19‚894 on May 15. However‚ market volume was light at HK$40.37 billion‚ down from HK$45.78 billion Wednesday‚ in part owing to an absence of trading cues from Wall Street‚ which was shut for the July 4 holiday on Wednesday.

On the JSE‚ Anglo American (AGL) gained R1.28 to R274.18‚ while BHP Billiton (BIL) dropped R1.20 to R237.50 and Sasol (SOL) shed 34 cents to R344.56.

AngloGold Ashanti (ANG) was down R2.01 to R278.22‚ while Gold Fields (GFI) gained 30 cents to R101.70 and Harmony Gold Mining (HAR) was flat at R76.31.

In platinum stocks‚ Anglo American Platinum (AMS) was unchanged at R440.00‚ while Aquarius Platinum (AQP) lost 11 cents‚ or 1.78%‚ to R6.07.

Among other miners‚ Kumba Iron Ore (KIO) garnered R8.75‚ or 1.56%‚ to R569.50.

In industrials‚ Barloworld (BAW) rose R1.38‚ or 1.66%‚ to R84.48.

Among banks‚ Nedbank (NED) was up R1 to R172.00 but Absa (ASA) lost 90c to R135.00.

In the retail sector The Foschini Group (TFG) gained R2.29‚ or 1.75%‚ to R132.99 - I-Net Bridge

TRADE CLOSE PERC POINTS

ALL SHARE (J203) 34121.22 34041.12 0.24 80.10

INDUSTRIALS (J257) 39171.31 38968.18 0.52 203.13

FINANCIALS (J580) 25871.45 25916.47 -0.17 -45.02

RESOURCES (J210) 47323.07 47273.58 0.10 49.49

GOLD (J150) 2322.03 2311.48 0.46 10.55

PLATINUM (J153) 48.59 48.31 0.58 0.28

BANKS (J835) 48051.74 48291.70 -0.50 239.96

Value traded R2.046bn

Volume 49.099 million shares

Highest value traded shares:

MTN 144.06 rand up 2.05 rand

Anglo 274.18 rand up 1.28 rand

BHP Billiton 237.50 rand dn 1.20 rand

Naspers 446.99 rand up 0.03 rand

Absa 135.00 rand dn 0.90 rand