Anglo American’s sale of its 20% stake in Gold Fields was the story of the day on the JSE Securities Exchange South Africa (JSE) just before midday on Monday, giving impetus to the rand, which dragged the overall market lower.
Volumes were impressive with more than R8-billion-worth of shares changing hands — a best-to-date daily turnover.
At 11.47am, the all-share and all-share industrial indices were down 0,54% and 0,52% respectively. Resources were 0,75% in the red, the gold mining index was down 1,41% and the platinum mining index was 1,02% weaker. The financial index was a marginal 0,15% softer, but the banks index was 0,28% in the black.
The rand was quoted at R6,46 per dollar from R6,57 when the JSE closed on Friday, while gold was quoted at $421,25 an ounce from $421,70/oz at the JSE’s last close.
“Anglo’s sale of its stake in Gold Fields is the main story. Most of the gold shares are down, but Gold Fields is up slightly. Guys are saying the sale is positive for Gold Fields. MMC has said it plans to up its stake — which means they will have to come into the market to buy shares — and a number of major players have upped their recommendations,” a dealer said.
Anglo American announced on Monday that it had sold its 20% stake in Gold Fields, consisting of 98 467 758 shares, to MMC Norilsk Nickel, for $1,16-billion.
Although the deal went through at R77,50 — well below the market price — Gold Fields shares were last quoted at R83.02, up two cents from Friday’s close. They earlier traded as high as R83,80.
Anglo American was down 90 cents at R150,60.
“The rand is really, really strong. With the Gold Fields deal, R7-billion has come through to the currency market and strengthened the rand big time. On the back of that, the rest of the resources market has taken a bit of a hammering,” the dealer commented.
AngloGold plunged 2,22% or R6,05 to R266,50 and Harmony lost 2,5% or R2,59 to R101.
Impala Platinum plummeted 2,03% or R11 to R531 and synthetic fuels group Sasol slumped 2,02% or R1,99 to R96,51.
AngloPlat, however, ticked up 95 cents to R281.
On the industrial market, Swiss-listed luxury goods group Richemont tumbled 2,41% or R1,99 to R15,81.
London-listed beverages group SABMiller weakened 25 cents to R72,50 and pulp and paper producer Sappi shed 36 cents to R86,16.
Steel producer Iscor was 1,64% or 60 cents softer at R36 and London-listed IT group Dimension Data dropped 3,06% or 13 cents to R4,12.
Cellular network operator MTN Group gave up 20 cents to R31,40.
On the upside, media group Naspers picked up 1,05% or 45 cents to R43,30 and transport and logistics group Imperial climbed 1,53% or R1 to R66,50.
Financials to fall included niche banking group Investec. Investec weakened 1,55% or R2,06 to R130,50 and Investec lost 2,25% or R2,99 to R130.
Liberty International plc was down 1,23% or 1,10 rand at R88,50 and Old Mutual was off seven cents at R11,68.
Banking group Nedcor eased 60 cents to R64,20 and ABSA was 20 cents lower at R45,30.
However, FirstRand firmed 1,05% or 10 cents to 9,60 rand and Standard Bank inched up five cents to 40,35 rand.
Insurer Mutual & Federal soared 2,5% or 45 cents to 18,45 rand after its majority owner Old Mutual South Africa repeated an earlier offer to minorities which the latter have rejected as unfair and unreasonable.
Old Mutual, through its nominee and wholly-owned subsidiary Mutual & Federal Investments, is offering R17,50 per share – or a cash consideration of R17,02 minus a final dividend of 48 cents. — I-Net Bridge