Johannesburg - South Africa’s Top-40 stock index booked its biggest one-day fall in more than five months on Wednesday, tumbling 1.9% as investors hammered mining companies over on-going wildcat strikes.
The Top 40
[JSE:J200] finished at 31 163.60 points, while the All Share
[JSE:J203] followed suit with a 1.7% decline to 35 415.07.
Anglo American Platinum slid over 6% after saying it had lost 20 000 ounces of the metal due to an illegal strike and that it could start laying off the miners.
“The market is obviously concerned where all this will end up,” said Ferdi Heyneke, a portfolio manager at Afrifocus Securities, referring to South Africa’s labour unrest.
“That is continuing to weigh down on mining stocks, but we are still seeing some good shares going against the trend, like retailers and good dividend paying shares.”
The euphoria that followed the announcement of further quantitative easing in the United States about a week ago has faded and nagging concerns over Europe’s economy have returned. These have also fed into weaker prices in Johannesburg.
The world is watching Spain where yields on 10-year bonds hit 6% as doubts mount about Madrid’s commitment to reform due to violent protests and talk of secession by the wealthy Catalonia region.
Heyneke said sentiment in the global markets was volatile and any news was likely to change the trend at a moment’s notice.
Share prices of South African mining firms have been on a downward trend for nearly two months following industrial action that started in the platinum sector but spread to gold and coal mines.
Shares of Amplats, the biggest producer of the white metal in the world, sunk 6% to R404.89. AngloGold Ashanti lost over 5% as the bullion producer said most of its 35 000 miners had joined a wildcat strike.
Harmony Gold, which is yet to suffer any of the latest string of industrial action, lost 6% to R67.50.
Some retailers went against the grain with supermarket chain Shoprite rising 1.2% to R170 and clothing retailer Mr Price gaining 0.7% to R124.95.
Activity was robust with over 201 million shares traded. Declining stocks outpaced advancers 185 to 96.
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