Johannesburg - South African stocks slid 1.4% on Monday, as a sharp decline in precious metal prices hit miners such
as Gold Fields and Impala Platinum.
Shares of RMI Holdings rose nearly 3% after black investment
group Royal Bafokeng Holdings said it would increase its stake in the insurance
holding company and its affiliate, bank holding firm RMB Holdings.
Traders said there could be further declines ahead after the
benchmark Top-40 index tried and failed to stay above the key resistance level
of 29 400 several times last week.
“About 11 times since the latter part of October, we just hit that
level and bounced off,” said Mitchell Gannaway, a trader at Thebe Stockbroking.
Without some positive news from Europe, the Top-40 would struggle
to sustain an advance above that level, Gannaway said. Worries about the euro
zone debt crisis have made foreign investors skittish about riskier emerging
market assets.
Overseas investors sold a net R300m ($36.90m)
worth of equities last week, and have sold a net R16.6bn worth of
stocks so far this year, data from the Johannesburg Stock Exchange showed on
Monday.
South Africa’s fall came in tandem with a decline in global equity
markets, as investors doubted last week’s euro zone summit was enough to solve
the region’s debt crisis.
Gold, usually seen as a safe-haven asset, was set for its biggest
one-day fall in three months, as investors pushed into the relative safety of
the U.S. dollar.
That hit miners such as Gold Fields. The world’s fourth-largest
bullion producer dropped 3 percent to 130.24 rand. A similar decline in platinum
prices pushed Impala Platinum, the world’s second-largest producer of the
precious metal, down nearly 5 percent to 167.55 rand.
Platinum miners have been among the worst performers on the Top-40
so far this year, hit by a 16 percent slide in the price of spot platinum.
Separately, Zimbabwe’s government said on Monday that Mimosa mine,
a joint venture between Impala and Aquarius, has given a 10 percent stake to
locals, to meet a controversial law on local ownership.
Shares of Afrimat, a supplier of buildings materials, surged 7.6
percent to 4.65 rand after the company said it would pay about $15 million for a
domestic concrete maker, Clinker Group. Afrimat said the deal would reduce its
exposure to cyclical factors.
Volume was thin, with preliminary exchange data showing 181 million
shares changing hands, well below the 20-day moving average of 279 million
shares.
Declining shares outnumbered advancers 158 to 126, while 66 shares
ended flat.