Johannesburg - Stocks fell
slightly on Friday as investors sold off shares in fixed-line
operator Telkom [JSE:TKG]
after the government said it would not
back its partnership with South Korean KT Corp.
Stocks were also swept up in an investor stampede to cash
and secure government bonds after US jobs data pointed to
slower growth in the world's largest economy.
The benchmark JSE Top 40 - (Tradeable) [JSE:J200] index fell 0.14% to
29 161.0 and the broader All-share index was 0.11% lower to 33 107.46.
Shares in Telkom dropped 8.34% to R21 - hitting
an eight-year low in the session.
The move was prompted by its largest shareholder, the South
African government, rejecting a deal seen as a lifeline for
Telkom's ailing fortunes hit by the decline in traditional
telephone usage and failed expansion in Nigeria.
South Korea's No. 2 mobile operator last month cut its offer
for a 20% stake in Telkom by nearly a third, bringing the
total sale value down to about R3.3bn
"With the reduced price, the government feels that selling
Telkom at this price would be a give away," said Dobek Pater, a
telecoms analyst at consultancy Africa Analysis.
Pater said the government may be betting on Telkom's
performance to improve, which would then boost the sale price.
The Telkom woes helped spur a broader market sell off made
worse by more signs of stuttering global growth.
"Weakness in Europe and Asia has weakened demand for
commodities," said Megaeconomics economist Colen Garrow.
Garrow said in a research note troubles in these markets
that are the main trading partner for South Africa will impact
major local economic indicators in the coming months.
Consecutive monthly, annualised growth rates have been
negative since last July and the latest figures are not expected
to be any different, he said.
A total of 259 million shares changed hands, according to
preliminary data from the exchange, just above a 200-day moving
average of about 250 million shares.