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Share prices on the road to recovery af... |
Share prices on the road to recovery after Asian fluSHARE prices showed signs of shaking off the Asian flu, finishing the week off earlier lows. A rebound in the bullion price which dealers ascribed to the short covering of positions by the US hedge funds also helped boost sentiment. Dealers warned, however, that the local market was not yet out of the woods and would succumb to spells of flu whenever Asia sneezed. "The market started off with a big bang on Asia but there's still some nervousness and uncertainty and it should still be nervous next week," a trader told Reuters. Dealers said the gold run was sparked by hedge funds seeking to cover their short positions ahead of the US holiday on Monday (Martin Luther day). The metal rose as high as $295 in early Comex trading, but signs of selling by bullion banks saw the price retrace early gains. In London gold was fixed, in the afternoon, at $290 versus last Friday's fix of $278,70. It slipped back to close at $289.50. Gold analysts warned that the metal would have to hold above $290 for a while before investors got convinced of the rebound. "It is great to see the gold price above $290 but investors are still wary as it went to $296 from $281 during December, only to slump to $278 in January. If we can hold above $300 an ounce for a few weeks, then I think people will start looking seriously at gold shares," one dealer said. Nevertheless, local gold shares spurted, lifting the gold index 11% or 81 points to end the week at 807 versus last Friday's 726. Vaal Reefs, which this week sold its marginal gold shafts to African Rainbow Minerals, closed R23 higher at R200. Kloof, the gold miner in the Gold Fields stable, ended almost 10% higher at R17.10. Gold Fields mines reported a 45% fall in their taxed profit for the December quarter versus the September quarter. Elands surged 20% to R13.20 while Harmony added 18% to close at R10.85. Elsewhere, retail group McRetail, which earlier this week announced a R187-million provision for its debtors book, shed 13.5% to end the week at R6.75. The retail group said the provision arose because of inappropriate credit granting in its Beares furniture unit. Private education and personnel placement group Educor eased 35c to R5,15 despite news that it was negotiating to buy an education and training company in North America. Educor also announced changes in its senior management. Car rental group Avis was a touch firmer at R8,10 versus last Friday's R8 close. The group said last week it had a 75% stake in timeshare company RCI. Food and clothing retailer Woolworths, which said it had secured a 28% stake in Australian retailer Country Road, was 15c easier at R6.50. Woolworths has made an offer, which closes on Thursday, to buy up to 51% of Country Road. Jabulani Sikhakhane Top of page
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