JOHANNESBURG Jan 24 (Reuters) – South African stocks
took a breather after five straight record highs on Tuesday,
edging down as concerns over Greece’s debt deal prompted
investors to cash in Standard Bank and other recent
gainers.
After a flat 2011, Johannesburg’s All-share index –
the widest measure of South African stock performance – has
gained nearly 6 percent this year, helped by renewed demand for
riskier emerging markets.
But after the index posted record closing highs in the last
five sessions, investors have cautioned that stocks may have
risen too far too quickly.
“From a technical perspective, we we rallied to oversold
levels in the recent days. All we’re seeing now is a bit of
healthy profit taking,” said Bernhard Grobler, head of
stockbroking at Investec.
“I think it would be premature to say the we have seen the
bottom of the euro zone debt crisis, things can still go any
which way. There’s still a lot uncertainty over whether Greece
would default.”
The All-share gave up 0.61 percent to 33,733.46. The index
hit a lifetime high of 33,949.41 in the previous session, and is
currently trading at an average of 13.5 times earnings, which
makes South African equities roughly as expensive as U.S.
rivals.
The benchmark Top-40 index closed down 0.6 percent
to 30,176.77, after briefly touching its highest since mid 2008.
News that euro zone finance ministers had turned down an
offer by private creditors to restructure their Greek debt
increased concerns about a potential default.
Recent gainers, such as banks, were hit by selling.
Continued…
