By lunchtime yesterday, the gold price was already up 1.7%, reports Fin24
, thanks to a weaker dollar. But the yellow metal is “still down more than a fifth this year”.
The rally in the gold price sent the JSE’s gold miners on a rally too. AngloGold Ashanti gained 8.15%, while Harmony surged 8.86% higher.
But it wasn’t plain sailing for the JSE.
“Gains were capped by retailer Truworths,” notes MoneyWeb
. The retailer plunged 7.08% “after it warned profit growth would miss expectations”. The blame was set at the door of “debt-laden customers”.
The net effect was the Top 40 closed up 1.01% higher and the All Share Index closed 0.85% up.
The gold price smashed through $1,300
Bullion’s jump above “above $1,300 an ounce sparked a rash of short covering,” notes BDLive
. Investors closed out “bets that prices would fall, propelling the metal higher”.
With “negative bets against gold” increasing over the past few weeks, there’s been a greater chance of “short-covering rallies,” adds BDLive
The precarious rand also had a good day, spurred on by the weaker dollar, reports I-Net Bridge
. The greenback has been weaker following the US Federal Reserve’s comments last week about its stimulus programme
And amidst all the construction sector scandal
, it was Group Five who “was the biggest gainer” on the ALSI, notes MoneyWeb
. The company impressively added 9.5%
after releasing news its “full-year profit would more than double”.
With reporting season well underway, we’ll have to wait and see what other surprises are in store for the JSE.