South African stocks wobbled more than one percent at the open on Monday, hurt by Wall Street-inspired losses in overseas markets but gains in gold shares lent support.
At 0722 GMT, the broad-share index was down 0,96% or 92,65 points at 9,548.25 led by market bellwether Anglo American Plc.
”All major indices are trading in the red. We’re following Wall Street here. Concerns over corporate profitability and the tensions of war in Iraq lingering in the market,” said Julian Henry of Barnard Jacobs Mellet.
Anglo, which accounts for around 16% of the market, dipped 2,9% to R136 before perking up to trade flat at R140. Fellow dual-listed counter Richemont gave up 3,14% to R15,40.
Some of the market’s major gauges like the blue-chip index of top 40 firms and the platinum index shaved off more than one percent as investors booked profits.
Gold shares climbed 2,5% helped by a firmer metal price and reaping the benefits of its status as a safe haven asset in the wake of falling equities markets and war tensions.
Gainers included Gold Fields, the market’s biggest unhedged stock, which added 3,8% to R134,80. Peer AngloGold notched up 0,9% to R562.
Smaller unhedged rival Harmony Gold nipped up 2,4% to R164,10.
Several traders said reports of a ”less onerous” draft mining reform charter spelling out softer targets for increased black participation in the industry lent some support to the resource-heavy Johannesburg bourse.
Elsewhere banking stocks took a knock, hurt by lingering concerns of another interest rate hike.
Big bank Nedcor dipped one percent to R100,50 and rival Standard Bank inched down 2,4% to R29,10.
Investors are keeping an eye on Nedcor which has made an offer to buy out minorities holding 16% of its Nedcor Investment Bank Holdings (NIB). Shareholders vote for the offer on Monday. Shares in NIB were flat at 330 cents. – Reuters