South African stocks could rally two percent or more this week if economic indicators underpin positive sentiment about the business climate, analysts said on Friday, although international uncertainty could weigh.
A flurry of upbeat results and trading outlooks from companies has helped to boost the all-share index and the leading 40 stocks over five percent so far this week, with the latter close to a resistance point at 9,400.
Brewing giant SABMiller's 49 percent jump in year earnings, reported on Thursday, has pumped the market higher and could keep sentiment bubbly, analysts said.
"I think the upwards rally could continue. The JTOPI correcting to 9,600, that's my target," said Bennie Strachan, portfolio manager at Real Africa Asset Managers.
Statistics due out on Tuesday are expected to show the economy grew three percent in the first quarter from the fourth quarter of 2003 when it expanded by 1.3 percent, according to consensus figures from a poll of 13 economists.
Inflation is likely to be broadly steady in April at 4.6 percent year-on-year, the poll suggested, from 4.4 percent in March, when official figures are published on Wednesday.
But international uncertainties would continue to have an influence, analysts added. Oil prices will be watched carefully, as Opec meets this weekend for informal talks against a background of US crude prices above $40 a barrel.
Any indications on future prospects for growth in China, a major export market for South Africa's giant metals miners, will also sway sentiment, analysts said.
On Wednesday, mining stocks shot higher after China ruled out an immediate interest rate hike, easing fears its economy and buoyant industrial demand might suffer a sharp slowdown.
Analysts said miners could extend gains, which have pushed the gold mining index up 6.8 percent so far this week, with global giant Anglo American and BHP Billiton tipped to lead any rally.
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