November 14, 2012 / 3:52 PM / 5 years ago

S.Africa stocks fall as retailers, miners wilt

* Top 40, All-share both shed 0.41 pct

* Technical factors suggest short-term gains tough

* Retailers, miners lead market down

By Ed Stoddard

JOHANNESBURG, Nov 14 (Reuters) - South African stocks fell for a second straight session on Wednesday as disappointing results dragged down retailers and a sell-off in mining stocks continued despite the prospect of an end to a crippling strike at Anglo American Platinum.

The JSE Top-40 index lost 0.41 percent to 33,042.71 while the broader All-share index also ended 0.41 percent lower at 37,241.79.

Both indices remain within striking distance of record peaks scaled last week but analysts say technical factors will make it difficult to set new highs in the short term.

“The momentum indicators are not strong. We’re going to struggle to punch through to new records,” said George Glynos, managing director at financial consultancy ETM.

For the Top 40 index, resistance would start to creep in around 33,518 and then stiffen considerably around its record level of 33,597.86 hit on Nov. 6, he added.

Technical indicators have shown that South African stocks are overbought and they are now moving to neutral territory, which could also slow any upward thrust.

The Top-40’s 14-day relative strength index, one measure of momentum, was around 54 on Wednesday. Technical traders who use the 14-day RSI often view numbers near 70 as a signal to sell and 30 to buy.

Retailers were in focus in Wednesday’s session. Shares of mid-cap Spar Group tumbled 3.7 percent to 122.30 rand after the supermarket chain reported full-year earnings that fell short of market expectations.

Mr. Price, which caters to lower income shoppers in Africa’s top economy, fell over one percent after it booked a 34 percent jump in first-half profit but warned of a tough business environment in 2013.

Investors in general soured on retailers, with South Africa’s biggest listed apparel retailer, Truworths International Ltd, stumbling 3.68 percent.

The relentless sell-off of mining shares was unabated despite the wind down of the worst industrial action since the end of apartheid in 1994. But the strikes have shaken investor confidence to the core.

Amplats, the world’s top producer, said it expected miners to return to work on Thursday after accepting a new pay deal to end weeks of wildcat strikes.

But in another sign of the mounting costs of the illegal strikes that have swept South Africa’s mines, it warned it would cut annual profit by more than a fifth.

Amplats lost 2 percent to a 2012 low of 370.01 rand and smaller rival Impala Platinum shed 3.25 percent. Bullion producers also wilted, led by Africa’s top gold mining company, AngloGold Ashanti, which fell 3.40 percent.

Decliners outnumbered gainers by 151 to 140 while 62 stocks closed unchanged. Volume was 190 million shares, slightly higher than in recent sessions. (Editing by Ed Cropley)

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