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R3.35bn in SA equities sold in 2012

January 2 2013 at 11:48am
By Helmo Preuss

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File photo of Johannesburg Stock Exchange in Sandton. Image: Thobeka Zazi Ndabula.

Johannesburg - Foreigners sold a net R3.351 billion worth of SA equities in 2012‚ while they bought a record net R85.373 billion worth of SA bonds‚ data supplied by the JSE showed on Wednesday.

This compared with net sales of R17.184 billion worth of equities in 2011 and net purchases of R37.501 billion worth of bonds.

The poor foreign appetite for SA equities was largely due to disillusionment with the SA resources sector‚ which has been hit by a spate of industrial action‚ which reduced production.

In the first ten months of 2012‚ mining production declined by 2.5% year on year after a 0.9% fall in 2011‚ when the sector was also hurt by industrial action.

By contrast‚ the bond sector was boosted by the inclusion of SA government bonds in the Citi World Government Bond Index (WGBI) from the end of September.

The probable inclusion in the WGBI was announced on April 17. Foreigners bought a net R7.79 billion rand worth of SA bonds on that day‚ which was the largest daily net foreign buying since 2008.

The record daily net foreign buying was set on April 25 2008 at R14.7 billion.

The year-to-date net foreign buying up to and including April 16 2012 was only R14.547 billion. Subsequent to April 16‚ foreigners bought a net R70.8 billion in the remainder of the year.

- I-Net Bridge


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