Bullion gains give bulls the run of the market

LOCAL stocks rose on Friday, led by gold mining shares as the price of bullion rose while an upbeat tone in major overseas markets added to bullish sentiment.

The blue-chip JSE Top 40 index closed 0.76% higher at 47 134 and the broader all share index was up 0.8% at 53 420.

Gold mining stocks dominated the bourse’s list of gainers, tracking bullion’s higher price and rand weakness.

“They are benefiting from the gold price, and we’re seeing a bit of weakness in the rand,” said Nolan Macnamara, a derivatives trader at Nedbank Wealth. “Also, a lot of these gold mining companies have been hit quite hard in recent months. They could be benefiting from bargain hunting.”

AngloGold Ashanti rallied 5.41% to R121.71, Harmony Gold picked up 3.44% to R21.93 and Gold Fields added 3.63% to R50.50.

Elsewhere, Pick n Pay Stores rose 3.05% to R52.38 after the supermarket chain forecast a leap in annual headline earnings a share of up to 30%.

On the downside, Kumba Iron Ore lost 4%, making it the biggest loser on the Top40, as Chinese iron-ore futures fell nearly 4% to touch a record low and posted a fourth successive weekly loss.

World equity markets tested record highs as hopes of more easy money from top central banks pushed Japan’s Nikkei index past 20 000 for the first time in 15 years.

Wall Street strengthened as industrial conglomerate General Electric said it would sell its finance arm, helping to lift the stock to its highest level since December 2013.

The Dow Jones industrial average edged up 0.3% to 18 013.19, the Standard & Poor’s 500 0.33% to 2 097.98 and the Nasdaq Composite 0.17% to 4 983.07.

Subdued Chinese inflation fuelled talk of additional stimulus from Beijing and came after figures this week from top economies such as the US and Germany generally bolstered the view that world growth is slowly perking up.

“We are in a honeymoon period for risk assets, and will be for another quarter,” said Sandra Crowl at Paris-based asset manager Carmignac Gestion.

The dollar remained king. It was heading for its best week since 2011 against a basket of other top currencies as the euro limped to its worst since 2011 and sterling slumped to a five-year low after poor UK industrial production data.

The pan-European FTSEurofirst 300 share index reached a 15-year high of more than 1 640 as its ninth week of rises in the past 10 took it to its highest level since 2000.

Germany’s DAX scored a record high, and the region’s other main indices all gained ground, including Britain’s FTSE 100.

Brent crude rose 1.7% to $57.53 a barrel. —