Johannesburg – Financial shares were been back in favour on the JSE as investors look for opportunities in what many regard as an overvalued market.
Wednesday’s favourite – resources shares – was the victim of profit taking while there were only marginal improvements in the prices of some of the big market capitalisation shares which have been supporting the Industrial index.
But the market was overall down in line with world markets. On Wednesday the major indices on Wall Street retreated on profit taking and political uncertainty in the US and the trend was followed on Thursday morning on the Asian markets.
In afternoon trade on Thursday, the All-share index on the JSE was 0.24% lower on 50 537 points. At one stage on Wednesday it looked as if the All-share index was on its way to 51 000 points. The Top 40-index was 0.21% weaker on 45 548 points.
The Financial 15 index was 0.36% better, while the Industrial index gained 0.21%. The Resources index was however 1.39% worse off than Wednesday.
FirstRand [JSE:FSR] and Rand Merchant Bank Holdings [JSE:RMH], which were at new records earlier this week and then fell back, were back at new 52-week highs. FirstRand is now 53.2% higher than a year ago after it gained another 0.86% on Thursday to trade at R40.95.
Rand Merchant Bank Holdings was only 3c higher than the record set on Tuesday when it improved with 0.11% to R53.19. The share price is now 47.4% stronger than a year ago.
There was also a lot of interest in insurance giants Sanlam [JSE:SLM] and Old Mutual [JSE:OML] with both shares amongst the busiest shares in terms of volume. Sanlam reached a high of R62.09 on Thursday morning which was better than last week’s record, but lost some ground later and traded only 0.34% higher on R61.55. This is 54c lower than the previous record.
Early on Thursday morning there was a lot of interest in Old Mutual which rose with 0.28% to R36.20. The share price is now only 21c lower than the record set in the beginning of May.
SABMiller [JSE:SAB] was again the centre of interest on Thursday. After the share price rose sharply on Tuesday to record levels on renewed speculation that the world’s biggest brewer, Anheuser-Busch InBev (AB InBev) may make a bid for it, it fell back on Wednesday after the rumours were denied.
The share rose again with 0.29% to R613.49 on Thursday, but is still below Tuesday’s record. The result of all the activity was that SABMiller’s market capitalisation tipped a trillion rand and was this morning on R1.026 trillion.
SABMiller is now the second biggest share on the JSE behind British American Tobacco [JSE:BTI], whose market capitalisation increased to R1.305 trillion on Thursday. The share price gained 0.98% to R644.14 to improve on the previous 52-week record high set last week.
Naspers [JSE:NPN] increased with another 0.61% to R1 246.78 and is now fast approaching the record of R1 354.09 which was set early in March before the share price experienced a serious correction of about 25%. Naspers’ market capitalisation was on R519.7bn on Thursday.