Mining stocks recoup June losses after rallying on JSE

The majority of mining stocks on the JSE yesterday put up a stronger performance despite mining shares on the local bourse. SUPPLIED

The majority of mining stocks on the JSE yesterday put up a stronger performance despite mining shares on the local bourse. SUPPLIED

Published Jul 4, 2024


The majority of mining stocks on the JSE yesterday put up a stronger performance despite mining shares on the local bourse, including Thungela, Sibanye-Stillwater, and Kumba Iron Ore making up the worst performers in June, with the exception of Pan African Resources which notched up a 50% year-to-date strengthening.

This comes as the Minerals Council called on Minerals and Petroleum Resources Minister Gwede Mantashe to use his reappointment to make the industry investor-friendly and said his return to the portfolio would allow for continuity of policy discussions and interactions.

Shares in Anglo American Platinum traded about 7% firmer on the JSE at around R608.91 yesterday despite being 11.78% and 5.73% lower in the past seven and 30 days, respectively.

Shares in Sibanye-Stillwater – which announced on Tuesday that it has laid off up to 11 500 employees in the past 18 months – strengthened by 4.81% in afternoon trade on the JSE yesterday to R19.81 in spite of trading in the red in the past seven days, 30 days and year-to-date comparatives.

Northam Platinum and African Rainbow Minerals traded around 4% stronger each despite weakness in the past 30 days.

Kumba Iron Ore was also firmer by nearly 5% in the afternoon trade session at around R470.48 per share, although Harmony Gold traded 2.29% lower, falling from its 3.62% strengthening in the past week.

Yesterday’s rally in the shares of SA mining companies was against the backdrop of the mining stocks plunging in value during the month of June and were among the worst shares on the JSE during the period.

Marco de Matos, research analyst at Anchor Capital, yesterday said the natural resource sector came under pressure in June, with most of the counters among the worst performers for the month.

Coal miner Thungela Resources was June’s worst-performing share, falling by 17.1% compared to the previous month.

This came after the miner warned that it expected to report lower first-half earnings for the six months ending June 30, 2024 due to a decrease in benchmark coal prices, drawdown on stockpiles from December, 2023 and an increase in lower-quality coal in its export sales mix.

“Thungela was followed by Sibanye-Stillwater, which was down 16.5% month on month. Sibanye-Stillwater CEO Neal Froneman said last week that the company was looking to raise more than $500 million (R9.2 billion) to shore up its balance sheet after earnings plunged due to a rout in metal prices,” said De Matos.

Kumba Iron Ore made up the third worst-performing stock in June, plunging by as much as 10.3% on a month-on-month comparative as iron ore prices remained under pressure. At the end of December, iron ore traded at $136 per ton before falling to a 2024 low of $97 per ton in April.

South32, which mines for manganese in South Africa, sank by 10.3% last month. South32 had said that it would not pay a premium for control of the two manganese mines in the Northern Cape, which it shares in a joint venture (JV) with Anglo American.

Thungela, Sibanye-Stillwater and BHP also entered the worst performers group on the JSE in the year-to-date comparative during the month of June. However, there was a sole bright spot, with Pan African Resources shares appreciating by 47.9% in the year-to-date comparative for June.

“Mid-tier gold producer Pan African Resources reigned supreme for a second consecutive month with a 47.9% year-to-date gain after its share price rose a further 0.7% in June,” De Matos added.

Last month, the miner said it had concluded a milestone five-year wage agreement with the National Union of Mineworkers (NUM) at its Barberton Mines operations.