Johannesburg - Shares of South African gold producers rose more than 4 percent on Thursday as investors bet unions and management would soon reach an agreement over wages, ending a strike by tens of thousands of miners.
The stoppage, launched on Tuesday night by the National Union of Mineworkers (NUM), has so far not hit production as hard as expected.
The country's mining industry body had estimated revenue losses of around $35 million a day if all shafts of the major producers were shut, but a third are still working at or near full capacity.
Both sides have been poles apart on the issue of wages with NUM seeking hikes as high as 60 percent for entry-level workers, but it has signalled a willingness to scale back other demands.
Two junior producers sealed pay deals with the union's members on Wednesday, agreeing to rises of only about 8 percent.
“The sentiment surrounding the strike has been effectively moderated by deals with smaller producers. It means that the NUM is more amenable and the likelihood of a prolonged strike is no longer there,” said David Davis, mining investment analyst at SBG Securities in Johannesburg.
Johannesburg's Gold Index was almost 4.5 percent higher at midday, led by Africa's top bullion producer AngloGold Ashanti, which was up 6 percent to 143.29 rand. Rival Harmony Gold added over 5 percent and Gold Fields climbed 3 percent to 54.50 rand.
The wage talks were on-going and were “at a very delicate stage,” said Charmane Russell, a spokeswoman for the gold producers. - Reuters