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South Africa: Metal Prices Underpin Surge in Resources
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Business Day (Johannesburg)
6 May 2008
Posted to the web 6 May 2008
Thabang Mokopanele
Johannesburg
A REBOUND in metal prices yesterday saw the domestic market rising sharply while playing catch-up with world stocks, as the rand stayed steady against major currencies.
However, trade was somewhat quiet, with the UK on a public holiday and people returning from public holidays in SA last week.
The all share index rose 556,44, or 1,8%, to 31299,93, the biggest percentage increase since April 16. "The market was mainly driven by the resources sector with a strong showing from Sasol, AngloGold Ashanti, Anglo Platinum and Exarro Resources. We also saw MTN shares rising on the back of continuing speculation that an Indian firm might launch a takeover bid for the company," BP Stockbrokers derivatives trader Vasilis Girasis said.
MTN confirmed it was in talks with Bharti Airtel yesterday.
Resources and metals stocks benefited from a metals price bounce, as bargain hunters snapped up gold after it hit a four-month low last week, while platinum was also up.
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The rand was largely quiet, with London players out and a dearth of domestic data after the long weekend.
The domestic currency got to an eight-week high of R7,51 to the dollar last week but, with domestic markets closed from Thursday , it has been trapped in ranges. Traders said the rand was trading with a firmer bias but it was still vulnerable due to lingering growth concerns.
The financial sector took a pounding, with lingering concern about the interest rates outlook. "The outlook remains a concern . The market is probably concerned about how long rates are likely to stay at elevated levels," BoE Stockbrokers analyst Andrew Todd said. With Reuters
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