South African Stocks Slip as Investors Assess Latest on Unrest
(Bloomberg) -- South African stocks retreated Thursday as investors assessed whether authorities are succeeding in calming rioting and looting that has left more than 70 people dead.
The FTSE/JSE Africa All Share Index dropped 0.4% by 10:06 a.m. in Johannesburg. A steadier rand helped a recovery in locally focused sectors, while benchmark giant Naspers Ltd. advanced. That was countered by declines in market heavyweight Richemont and drops in mining majors BHP Group Plc and Anglo American Plc. Insurer Liberty Holdings Ltd. soared the most on record as majority shareholder Standard Bank Group Ltd. said it plans to acquire the shares it doesn’t already own.
South African Defence Minister Nosiviwe Mapisa-Nqakula told lawmakers Wednesday that troops in the provinces of KwaZulu-Natal and Gauteng, which have been the epicenter of the looting and destruction of businesses, will be boosted to 25,000 from about 5,000. Protests erupted on July 10 after former President Jacob Zuma was incarcerated for defying a court order to testify before a graft inquiry and degenerated into a free-for-all in two of the country’s main economic hubs.
Globally, traders were digesting data suggesting China’s growth rebound is steadying as well as Federal Reserve Chair Jerome Powell’s signal that it’s still too early in the U.S. recovery to pare stimulus.
Naspers, with a 14% weighting on the index, advanced for a fourth consecutive session, up 1.5% as partly owned Tencent Holdings Ltd. gained in Hong Kong.
Precious metals miners rose 1% as gold and platinum prices climbed Powell’s reassurance on the outlook for stimulus, while rising inflation helped boost demand for bullion.
- NOTE: Gold Holds Near Four-Week High After Powell Stimulus Reassurance
- Impala Platinum Holdings Ltd. +1.3%, AngloGold Ashanti Ltd. +1.7%, Anglo American Platinum Ltd. +1.1%, Sibanye Stillwater Ltd. +0.5%, Northam Platinum Ltd. +0.6%, Harmony Gold Mining Co. +1%
Liberty Holdings jumped as much as 26% on the Standard Bank buyout news.
- NOTE: Standard Bank Plans to Acquire Liberty Stake It Doesn’t Own
Standard Bank was 1.2% lower, underperforming its local banking peers.
Luxury goods retailer Richemont dropped 0.7% to drag on the overall index.
Sasol dropped 4.3%, the biggest decline since June 18, as oil prices extended their losses.
Industrial miners declined 1.4%, as China cut its record-breaking steel production for the first time this year.
- NOTE: China Makes a Hefty Cut to Steel Production as Demand Slackens
- BHP -1.3%, Anglo American Plc -1.7%, Glencore Plc -1.5%, Kumba Iron Ore Ltd -0.1%
Foreign investors outflows continued for fifth consecutive day, with non-locals disposing of 2.09 billion rand ($144 million) in local equities Wednesday, according to data from exchange operator JSE Ltd.
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