adminJohannesburg – The All-share index on the JSE is approaching the 52,000 level again, after another solid performance yesterday morning. It is the third day in a row that the market is edging upwards.
Technical analysts say some sectors are oversold, and yesterday morning the Financial and Industrial indices made strong runs.
By midday the All-share index was 0.52 percent higher at 51,731 points, while the Top 40 index traded 0.54 percent stronger at 46,326 points.
Some good news about the Chinese and the American economies also contributed towards the more upbeat mood, as these economies are important markets for South African exports.
HSBC said its purchasing managers’ index (PMI) for the Chinese economy hit a seven-month high of 54.1 last month, while the official PMI climbed for the first time in three months, to 54.4. A figure above 50 indicates growth and anything below points to contraction. The results helped temper disappointment at Monday’s manufacturing PMIs.
Traders were also given a boost from the United States, where the PMI from the Institute for Supply Management picked up pace in August, hitting its best level since August 2011.
The star performer on the JSE was the Industrial index, which gained 0.92 percent to 60,557 points. If the index can improve on these levels and break through an important resistance level at 60,580, it can lead to more advances.
Naspers [JSE:NPN], one of the shares with the biggest weight in the index, contributed to yesterday’s improvement when it gained 2.26 percent to R1,394.60.
Aspen [JSE:APN] was also one of the busiest shares in terms of value and rose 2.09 percent to R320,75, a new 52-week high. The previous high was set in June. Shares to the value of R184m were sold.
Aspen’s share price started a run last week when the company said that earnings per share excluding one-time items rose between 26 percent to 32 percent in the year ended June 30. The share price increased by 13.1 percent over the last three months and is now 35.3 percent higher for the year.
The financial sector lavished much attention on life insurance companies, with Discovery [JSE:DSY], Sanlam [JSE:SLM] and MMI [JSE:MMI] all reaching new 52-week highs.
The Imara SP Reid technical research team said in its daily Market Snapshot that investors should retain their exposure to the life sector, as there is still strong technical support for these shares.
Discovery’s share lifted by 2.84 percent to a new high of R102,12 after the company announced a rise of 57percent in full-year earnings. The previous high was R100.
The price is now 25.7 percent higher for the past six months. Sanlam is again trading at a 52-week high and increased by 2.59 percent to R67,25.
The company said in a trading statement that earnings for the first half of the year will be between 25 percent and 30 percent higher than the previous year.
MMI managed to go up 1 cent up on Tuesday’s 52-week high and traded at R28,26. – Fin24
Online Reporter