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Johannesburg - South African stocks rose more than 1% on Monday, helped by grocer Pick n Pay which said it expected higher half-year profits, while investors looked for bargains in some oversold companies.
No.2 grocer Pick n Pay said half-year profits would be boosted by cost-cutting measures to offset sluggish growth sales as consumer spending failed to pick up. Its shares rose 1.9% at R55.56.
The All-share index ended the day 1.14% higher at 49 166 while the Top-40, added 1.27% to 43 933. Both indices lost almost 3% last week.
"Some shares have become completely oversold recently and now we are seeing a fairly broad recovery," said Ferdi Heyneke, a trader at Afrifocus Securities.
Johannesburg's mining index rose 1.5% on the day, led by companies such as Assore, Kumba Iron Ore and BHP Billiton, despite iron ore prices hovering near five-year lows.
The Johannesburg-listed shares of the world's largest diversified miner, BHP Billiton, rose 1.3% to R301.83 after the company said it planned to squeeze more tonnage from its iron mines more cheaply.
Iron ore producer Assore was biggest gainer on the Top-40 index, climbing 5.1% to R215.
The company's shares had fallen more than 8% last week.
"Assore has had a very big drop so its not too surprising to see some bargain-buying coming through in that stock," Heyneke said.
Trading volumes were relatively slow, with 163 million shares changing hands, compared to last year's daily average of 176 million. A total of 175 shares advanced, while 119 declined.
