JOHANNESBURG, March 1 (Reuters) – South African stocks
closed flat on Thursday as commodity shares, particularly the
gold producers, pulled the market lower after an overnight fall
in the spot price and the strengthening of the rand currency.
The blue-chip Top-40 index edged down 0.07 percent
to 30,526.43 while the broader All-share index closed
0.01 percent up at 34,298.48.
Gold stocks declined in early trade after a 5 percent
overnight fall in the spot price after U.S. Federal
Reserve Chairman Ben Bernanke gave no hints of a third round of
quantitative easing.
While bullion clawed back some of its losses, adding more
than 1 percent during the day’s trade, local gold stocks failed
to catch up. The rand also weighed as it added 0.5
percent on the day.
A stronger rand has a negative impact on local miners
because most of their costs are priced in the domestic currency
but their product fetches dollars.
The country’s top three gold producers all ended lower with
Harmony Gold Mining the worst hit. Its shares were
knocked more than 3.7 percent to 95.33 rand while rival Gold
Fields closed 2.5 percent lower at 115.83 rand.
Shares in AngloGold Ashanti, Africa’s largest gold
producer, fell 2.45 percent to end at 317.75 rand.
“It’s been a double negative for gold stocks with the gold
price falling on U.S Federal Reserve Chairman Ben Bernanke’s
comments last night and on the stronger rand,” said Afrifocus
Securities portfolio manager Ferdi Heyneke.
Heyneke said the entire precious metals complex was hit and
platinum stocks also had a bad day with the largest producers
ending lower.
Continued…
