JSE stocks drop most in 5 months

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IOL image JSE interior view INDEPENDENT MEDIA The JSE is seen in this file photo: Leon Nicholas.

Johannesburg -- South Africa’s stocks gauge fell the most in almost five months as mining companies slumped on concern comments from the US Federal Reserve and China signalled lower demand for commodities.

The FTSE/JSE Africa All Share Index dropped 1.5 percent to 39,834.92 by 1:51 p.m. in Johannesburg, the biggest intraday plunge since September 26.

The mining index retreated 3.4 percent, the most since October 2011.

The main gauge has slid 2.1 percent this week, set for the biggest weekly decline since May.

China, the world’s second-biggest economy, called on local authorities to curb real-estate speculation and rein in the property market, according to a statement yesterday.

The Federal Reserve may consider slowing the pace of asset purchases, according to minutes of the Federal Open Market Committee’s Jan 29-30 meeting released yesterday in Washington.

“Nobody knows what is going to happen after the minutes, whether they are going to pull the plug or not,” Jesse Van Rensburg, an equity sales trader at Johannesburg-based Renaissance Bjm Securities, said in a phone interview today.

“Metal prices are down. There are some downbeat comments from China.”

The Standard & Poor’s GSCI index of raw materials slumped to a three-week low as prices of metals including copper and platinum tumbled.

Metals and other commodities accounted for 53 percent of South Africa’s exports in 2012, according to government data.

The All-Share index is poised to close below the 40,000 mark for the first time since January 22, data compiled by Bloomberg show. - Bloomberg

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