Stocks hit new highs, rand stabilises

THE MAIN stock indexes reached record highs yesterday, tracking a rally in major overseas markets, with Group Five surging more than 20 percent after the builder received an offer for its European businesses.

The benchmark JSE Top40 index added 0.51 percent to 51 713.37 points after touching a record high of 51 915. The broader all share index gained 0.5 percent to 58 163.56 points.

Group Five topped the gainers list on the bourse, rising as much as 43 percent before paring its advances to still a hefty 24.86 percent at R11.50.

The company has received a R1.6 billion bid from Greenbay Properties for its best-performing road maintenance business in eastern Europe.

Garth Arena, an analyst at Avior Capital Markets, believes the amount offered “is fair and above the current fair value reflected by management in financial statements”.

In foreign exchange, the rand was stable, retreating only slightly from a three-week high touched on Friday, 0.19 percent weaker on the day.

However, at 5pm, the rand bid at R13.2899 to the dollar, 1.70c stronger than at the same time on Friday.

Gerry van Rooyen, an economist at NKC African Economics, said he thought the impact of Friday’s court ruling upholding graft charges against President Jacob Zuma had been overstated.

He said that if inflation data due on Wednesday came in below expectations, then the rand could strengthen towards 13 to the dollar.

In fixed income, the yield for the benchmark government bond due in 2026 was up 0.5 basis points to 8.625 percent.