Wednesday, 12 December 2012 20:35
JOHANNESBURG: South African stocks booked a record closes on Wednesday, extending their run into a third day, as hopes of further US stimulus boosted riskier assets worldwide.
Mining shares topped the gainers' list on the benchmark JSE Top-40 index as metal prices cruised higher with the price of copper at its strongest level in two months.
The stock market has hit a string record highs this year, largely unmoved by a global economic slowdown, US fiscal problems, wildcat strikes at home and the euro zone debt crisis.
"What alternatives do you have to generate returns? We are in a low interest rate environment, cash is cheap and doesn't earn you anything in the bank so everyone is chasing the same asset for decent returns," Nilan Morar, a dealer at Global Trader.
"If you get a stock market that delivers 20 percent or even 15 percent return that's three or five times what you're getting in money markets and other asset classes."
The benchmark JSE Top-40 index rose 0.51 percent to a record closing high of 34,415.32, pulling back from a record 34,460.45 level set during the session.
The broader All-share index added 0.59 percent to its highest closing level of 38,763.64. It earlier reached a lifetime high of 38,789.43.
Investors are on course to reap about 20 percent return on domestic equities but a weaker rand currency, which has lost about 7 percent of its value so far this year, has eaten into returns for foreign investors.
Helped by higher metal prices, global miner Anglo American added 3.2 percent to 264.50 rand, Anglo American Platinum climbed 3.8 percent to 434.05 and African Rainbow Minerals rose 2.1 percent to 190.20 rand.
On the downside, PPC Ltd slipped 0.73 percent to 32.61 rand after the cement maker said it would pay $69 million for a controlling stake in Rwanda's only cement maker Cimerwa.
Employment placement agency Adcorp Holdings lost 0.6 percent to 29.77 rand after saying it would pay $63 million for a Melbourne-based IT jobs recruiter Paxus.
A total of 212 million shares changed hands, according the preliminary exchange data, with gainers outnumbering decliners 194 to 91 while 71 stocks were unchanged.
Copyright Reuters, 2012