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Market rises as interest rates drop and ... Bulls grazing peacefully in dull marke...
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Market rises as interest rates drop and sentiment improvesTHE all-share index collected another 3% to push through the 6 000-point barrier in a week of dropping interest rates and rising sentiment. Financials had a strong run: the index was up 6% to 9 817. Nedcor climbed 840c to R120.40 on fine results, Forbes added 225c to R12.50 (it was 750c a fortnight ago) also on good profit growth and African Harvest reaped a 380c rise to R24. Specialised Outsourcing leaped 28% to R34.50 ahead of quarterlies. Gensec added 22% to R37.70 but the options climbed fivefold to 350c. A possible explanation is a short position in the out-of-the-money options, whose strike date was put back six months to May next year. Other sectors also benefited from lower interest rates. Retailers like Foschini, Wooltru and Pick 'n Pay rose strongly, and gross domestic fixed investment stocks like LTA, Barlows and Dorbyl strengthened. Bucking the trend was Murray & Roberts, which, in spite of a record order book and probably on a forward price-earnings ratio of four, endured market scepticism about its alloy wheels business. Smaller IT stocks reclaimed some limelight and there were cautionaries from several. Among movers were Brainware (doubled to 130c), Set Point, Spicer, UCS, AST, MB Tech and CCH. But Datatec, which warned twice more and doubled earnings, eased 550c to R79.50. There were 16 new or renewed cautionaries and one withdrawal. Chariots changed hands in outsized volumes; the market expects a deal soon. The JSE waved goodbye to several long-standing listings: Mega, Times Media, Alpha and Hoechst all delisting on Friday. But there were two new listings. Compu-Clearing Outsourcing, which placed shares at 100c, traded between 160c and 220c, closing at 200c. Indequity, also issued at 100c with net asset value at 41c, listed 8-million shares that closed at 425c. Conshu's results led to a startling recovery in the share price. After trading around 90c in three deals, it added 78c to 180c on only 300 shares on Friday. The directors report a R2.1-million extraordinary provision for writedown of loans to the Executive Share Trust. The underlying security against the loan is Conshu's share price, which this year collapsed from 350c to as low as 75c. It was 725c in 1994. Mathomo picked up 52c to 170c after Mineworkers' Investment Company undertook to honour a R29.9-million subscription for 8.5-million Mathomo shares at 352c. A big seller of Primedia seems to have sold out; the share put on 400c to R25. Educor also added 17% to 760c on a cautionary, while one from Wentech could not shore the price up all week; it shed 11c to 69c on Friday. The JSE acted swiftly to suspend Mathison & Hollidge after its capital adequacy was found wanting. Gold's disappointing run induced some shedding of golds by private investors. The gold index slipped 7% to 985 points.
Julie Walker Top of page
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