INVESTORS’ strong appetite for banking and financial stocks kept the JSE in positive territory on Thursday, offsetting weakness in the general resources sector.
Gold stocks were particularly under pressure as a result of a lower gold spot price as well as caution ahead of the National Energy Regulator of SA’s decision on Eskom’s tariff hikes application, due this afternoon. Mining houses are already under pressure from rising costs.
At 12.26pm the all share index was 0.41% higher at 39,435.75 points, with the top 40 index regaining 0.44% at 35,005.73.
Banks and financials lifted 1.89% and 1.31% respectively while gold stocks lost 2.02%.
"Resources continue to lag as a lower gold price weighs on gold stocks while strong results from Liberty Holdings boosted financial stocks," said Nedbank Capital strategic research head Mohammed Nalla said.
Nalla said that after some value-buying in the resource sector, earnings of mining companies had disappointed after production cuts and labour unrest, leading this index weaker.
"Signs of economic recovery globally remain uncertain and this is causing concern, resulting in a moderation in risk appetite," he said.
Leading European markets were broadly firmer at noon, with London’s FTSE 100 up 0.3%.
On the JSE, FirstRand rallied 3.31% to R30.91, RMB Holdings gained 3.63% to R41.37 and Discovery was up 3.28% to R74.96. Liberty Holdings was up 1.57% to R116.80.
Among miners, AngloGold Ashanti lost 1.99% to R218.85 and Harmony Gold dropped 2.43% to R55.48.
The spot price of gold was down 0.53% at $1,588.74 an ounce at 1pm.