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S. Africa Stocks Stay Near Record as Naspers Offsets Weak Miners

Published 01/15/2021, 03:08 AM
Updated 01/15/2021, 03:54 AM
© Reuters. S. Africa Stocks Stay Near Record as Naspers Offsets Weak Miners

(Bloomberg) -- South African stocks held steady near recent all-time highs on Friday as investors scrutinized U.S. President-elect Joe Biden’s much-anticipated $1.9 trillion relief plan for the world’s largest economy.

The benchmark FTSE/JSE Africa All Share Index was little changed as of 9:56 a.m. in Johannesburg after closing at a record Thursday. Tech investor Naspers Ltd. supported the market amid a continued rally in partly owned Tencent Holdings (OTC:TCEHY) Ltd. in Hong Kong. Mining giants BHP Group (NYSE:BHP) Plc and Anglo American (LON:AAL) Plc weighed on the gauge, giving up some of their recent gains.

Locally, traders were digesting the latest developments in South Africa’s coronavirus response, with the government announcing that the reopening of schools will be delayed by two weeks. The country is also in the second of four days of rolling power cuts after the state-owned utility reported a malfunction at a newly built plant and other operational issues.

Naspers rose 1.5%, while unit Prosus (OTC:PROSF), which holds the Cape Town-based company’s 31% stake in Tencent, gained 1.3%. The two stocks contributed the most index points to the benchmark’s daily performance. Tencent was 1.8% higher and heading to a fresh record high.

Gold stocks supported the market as bullion prices steadied while investors parsed details of the U.S. stimulus package, as well as commentary from Federal Reserve Chair Jerome Powell that pointed to sustained monetary support. Harmony Gold Mining (NYSE:HMY)  gained 0.3% and Gold Fields (NYSE:GFI) Ltd. rose 0.2%.

BHP  (JO:BHPJ) dropped 0.9% and Anglo American (JO:AGLJ) fell 0.4% to be among the biggest drags on the benchmark. An index of mining stocks declined 0.4%. Luxury-goods maker Richemont slipped 1%, despite analyst rating upgrades from HSBC Holdings (NYSE:HSBC) and Exane BNP Paribas (OTC:BNPQY).

Bank stocks were weaker as the rand retreated against the dollar. An index of lenders slid for a third day, with Firstrand Ltd (JO:FSRJ) down 1% and Standard Bank Group Ltd (JO:SBKJ) falling 0.7%.

Still, the main South African stock index is up 0.6% since Monday, heading for a third successive weekly gain for the first time since August.

The surge that’s pushed the market to five record closes this month has prompted a signal that Johannesburg stocks are technically overbought for an eighth day, the longest such sequence since 2017. The 14-day relative strength index on the benchmark was above 77 on Friday, beyond the level of 70 that suggests to some analysts that the rally may be overdone.

 

 

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