The JSE Closed Lower 0.25 Percent Yesterday as Mining Stocks Tumbled

 

Investors on the JSE sold off mining stocks more than other stocks as the top five losers on the JSE were all mining stocks. They included the biggest loser EXXARO that went down 4.3%, ASSORE down 3.9%, ANGGOLD down 3.5% AMPLATS down 3.5% and IMPLATS 2.5%. The mining industry is marred by a couple of factors including: depressed commodity prices, labour unrest in South Africa that Affects production , regulatory challenges and increased cost of mining due to increased labour and other costs in the economy. There are talks about retrenchments in the sector as debts compound and prices of the resources are depressed. Investors should continue to watch various mining stocks as some might just turn out to be bargains in the coming months.

jse nov 11

Following better than expected data on manufacturing production and sales released by stats SA, retailers made up the majority of the winners with TIGBRANDS being the top winner with its shares up 3.0%, Mr. price up 2.0%, STEINHOFF, REINET and BIDVEST all up 1.8% respectively. Data released by Stats SA showed a strong rebound in manufacturing production in September.  The year on year increase for September was 8%, after falling by a revised 1% (1.2%) in August mainly due to strike disruptions in July that impacted output.

The figures by stats SA showed that the 8% increase was mainly due to higher production in the motor vehicles, parts and accessories and other transport equipment division, which rose 121.6% and contributed 5.8 percentage points. Stats SA said that production in the automotive sector was adversely affected by industrial action in September last year, which provided a low base and boosted the figures in September this year. It was also revealed by the stats that the month on month increase was 4%. Given a more stable labour environment one would expect manufacturing and retail sales to continue doing well till the end of 2014

Equities (Top 40)
Top Gainers Top Losers
TIGBRANDS 35544c 3.0% EXXARO 11350c -4.3%
MR PRICE 23500c 2.0% ASSORE 21129c -3.9%
STEINHOFF 5545c 1.8% ANGGOLD 10270c -3.5%
REINET 2687c 1.8% AMPLATS 37000c -3.1%
BIDVEST 30580c 1.8% IMPLATS 8104c -2.5%
Trade Up Down Same Total*
Shares 157 172 365 694
Value R6.8B R7.3B R135.8M R14.3B

 

Investors on the JSE today will continue to watch various global and local factors including the downgrade of five commercial banks in South Africa by rating agency- Moody’s, global markets and data to be released by stats SA. Stats SA will release retail sales data for September this morning and analyst expect the data to be better than that for August. Retail trade sales increased by 2, 1% year-on-year in August 2014. With the highest growth recorded in retailers of hardware, paint and glass (4, 6%), general dealers (3, %) and all other retail 3.1%. A better than expected retail figure for September will push upward performance in various stocks in the sector.

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