Volatility rules the roost as JSE discounts Budget, then wavers
VOLATILITY was the order of the week on the JSE.
Volume was good on Monday and Tuesday ahead of the Budget and the indices picked up 40 or 50 points apiece discounting some of the news.
In spite of a rather flat Budget, the market was steady again on Thursday, but took a walloping on Friday after jitters on Wall Street.
On Thursday, the Dow Jones Industrial index shed 160 points or 2.28% to 6 879. This, coupled with the March futures closeout, made the JSE extremely nervous on Friday and the all-share index gave up 45 points to 7 127. This was nevertheless 26 points above the day's low, and 55 points up on the whole week.
The industrial index also added a net 75 to 8 327, but the gold index was a few points easier on the week at 1 408 - only Avgold looked strong.
Financials had a good week, possibly on raised hopes of an interest-rate cut sooner rather than later. Bonds reacted positively, the yield on the R150 falling from above 15% to 14.68% at the peak before drifting to 14.89% on Friday in sympathy with the equity market.
Almost ironically, the rand firmed on news that foreign exchange controls are to be relaxed. Starting the week at nearly 446c, it strengthened to better than 440c before dollar-demand pushed it to just under 444c.
The BoE/NBS Boland/Samgro deal was well received: From R96 a week ago, BoE picked up 900c to R115 on Friday alone as terms were announced. Boland climbed 250c to R47, Samgro 200c to R14 and NBS 700c to R75. Among other banks, Nedcor picked up 325c to R84.25 and RMBH 450c to R98.50.
Baobab distributed rights to Mustek as nilpaid letters. The Baobab price retreated from R34.50 to R27, but for every Baobab, members received 1.27 npls which closed at R13.10.
Plastall will issue shares at 500c. As recently as November it was 200c, and 400c at the end of January, before a series of cautionaries starting on 6 February helped the price to 950c. It has since retreated to 750c - all movement in tiny volumes whereas Winbel and Winhold have traded in millions. Caution is certainly advised.
Conshu, the shoe giant in the SA Breweries fold that was 600c a year ago, picked up 50c to 200c on improved prospects following notice that imported shoe quotas would be slashed.
Someone had the inside track on Aukland, which warned on negotiations but not before the price had jumped from 330c to 510c. It closed at 460c. Chubb warned its British parent could be taken over and put on 400c to R20 on a deal of 2 400 shares.