FirstRand caps JSE’s losses as mining shares slide

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Reuters

Stocks edged down yesterday, as platinum producers were hit again by worries about the impact of labour unrest on the sector. However, losses were limited by an increase in FirstRand.

Investors have dumped mining company shares in recent sessions on concerns about spreading labour unrest in the industry, following weeks of protest at Lonmin’s Marikana mine.

In addition, nagging worries about the outlook for Europe had made it easier for investors to sell, Abri du Plessis, the chief investment officer at Gryphon Asset Management, said yesterday.

“Moving money at this time, I think one can only make mistakes,” he said. “The problems [in Europe] are a lot deeper than the consensus expectations. I think we are going to see a deeper slowdown there.”

The blue chip Top40 index dropped by 1.1 percent to 30 884.69 points. The broader all share index retreated by 0.91 percent to 35 161.01 points. Both indices hit record highs last week.

Anglo American Platinum slumped 1.94 percent to R405. Impala Platinum slipped 2.77 percent to R126.40.

But FirstRand gained 1.21 percent to R27.71. The bank said it expected full-year earnings to rise by as much as 27 percent, well above the average of 20 percent growth in a poll of 17 analysts.

Although it did not give a reason for the expected rise, profits were likely boosted by strong performance at its retail and vehicle financing units, said Adrian Cloete, an analyst at Cadiz Asset Management.

Meanwhile, Steinhoff International fell 1.24 percent to R26.20, after the furniture maker reported a 32 percent increase in full-year profit, disappointing investors who were hoping for a better result.

Trade was thin, with 157 million shares changing hands on the exchange during the session, compared with last year’s daily average of 255 million shares.


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