A rampaging rand — trading at its best levels for more than a year — smacked South African stocks down over one percent on Tuesday morning as investors sold out of firms that pay costs at home and earn abroad.
At 0900 GMT, the all-share index was 1,3% or 120,22 points lower at 9,372.64 points, dragged down by the bourse’s biggest counter, mining house Anglo American.
Anglo, which accounts for around 15% of the market’s total market capitalisation, skidded 2,7% to R125,50. It was the top traded stock by deals.
Peer BHP Billiton surrendered 1,5% to R46,30. Other rand-hedges feeling the heat of the stronger rand included synthetic fuel producer Sasol, which wilted 3,2% to R104,99.
The rand fired to 9,16 against the dollar early on Tuesday, its best level in well over a year. It was at 9,215 rand by 0900 GMT.
Gold mining shares also came under pressure with the stronger rand and a bullion price that was off recent strengths. Spot gold was up at $318,00 a troy ounce at 0900 GMT on New York’s $318,80 close, off levels above $320 seen early on Monday.
The country’s number one producer of the precious metal, AngloGold, crumpled 4,2% to R474. Rival GoldFields slid 0,7% to R98,30 and Harmony Gold dribbled two percent lower to R119,60.
But the raging rand failed to ignite financial shares.
”The focus is very much on the gold shares, and the financials are waiting for the MPC meeting,” said Thabo Tleane of Legae Securities in Johannesburg.
Bank stocks are seen trading cautiously ahead of a central bank monetary policy committee (MPC) meeting this week to decide interest rates.
Nedcor fell 0,2% to R119 and Absa gave up 0,6% to R34,50. But FirstRand gained 0,5% to reach R7,83 and Standard Bank added 0,6% to hit R31,90. – Reuters