Johannesburg - Thursday's drop in share prices on the JSE was nothing
more than the market taking a breather, as the major indices continued
their upward trend on Friday morning. By midday the All-share index was
well above 51 000 and the Top 40-index solidly above 45 000.
Markets
elsewhere in the world were also higher, with Frankfurt's Dax index
heading towards its best month in six-and-a-half years.
The JSE was modestly lower on Thursday in reaction to world markets, after fears that the US Federal Reserve could decide to raise interest rates earlier than originally expected. It seemed later that analysts over-reacted and that the Fed intends to stick to its original plan not to rush into hiking interest rates before the deflation threat disappears.
The All-share index however lost some steam on Friday morning after jumping out of the starter blocks in reaction to Thursday's rally on Wall Street.
By midday the All-Share index was 0.78% higher at 51 355, while the Top 40-index traded 0.99% stronger at 45 213. Resources shares continued their recovery and the Resources 10-index was 1.87% higher, while the Gold index gained 1.38% after a modest rise in the gold price.
Wall Street rallied on Thursday after two days of losses on solid company results and a modest rise in the oil price after the commodity fell sharply on Wednesday.
"Investors are worried that falling commodity prices could lead to a deflationary period," said Peter Cardillo, chief market economist at Rockwell Global Capital.
The rise in the oil price was capped by news that the US senate approved a bill that will allow an oil pipeline from Canada, where oil is extracted from oil sand, to refineries on the US Gold Coast.
The rise in the price of Brent, which traded at $49.35 by midday, was however enough to give Sasol’s [JSE:SOL] share price a boost. The company’s income is closely related to the oil price and on Thursday it announced measures to preserve cash, including postponing some capital projects.
The JSE was modestly lower on Thursday in reaction to world markets, after fears that the US Federal Reserve could decide to raise interest rates earlier than originally expected. It seemed later that analysts over-reacted and that the Fed intends to stick to its original plan not to rush into hiking interest rates before the deflation threat disappears.
The All-share index however lost some steam on Friday morning after jumping out of the starter blocks in reaction to Thursday's rally on Wall Street.
By midday the All-Share index was 0.78% higher at 51 355, while the Top 40-index traded 0.99% stronger at 45 213. Resources shares continued their recovery and the Resources 10-index was 1.87% higher, while the Gold index gained 1.38% after a modest rise in the gold price.
Wall Street rallied on Thursday after two days of losses on solid company results and a modest rise in the oil price after the commodity fell sharply on Wednesday.
"Investors are worried that falling commodity prices could lead to a deflationary period," said Peter Cardillo, chief market economist at Rockwell Global Capital.
The rise in the oil price was capped by news that the US senate approved a bill that will allow an oil pipeline from Canada, where oil is extracted from oil sand, to refineries on the US Gold Coast.
The rise in the price of Brent, which traded at $49.35 by midday, was however enough to give Sasol’s [JSE:SOL] share price a boost. The company’s income is closely related to the oil price and on Thursday it announced measures to preserve cash, including postponing some capital projects.
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