SA stocks drop as Anglo leads miners’ post-Fed slump

South African stocks retreated, tracking declines in emerging-market peers as the US Federal Reserve’s hawkish turn hurt appetite for riskier assets. Major miners were a big drag on the benchmark equity index as a stronger dollar hit metals prices.

The FTSE/JSE Africa All Share Index slipped 0.7% as of 9:24 a.m. in Johannesburg, falling for a second day as trading resumed after Wednesday’s public holiday. An MSCI gauge of Asian shares was on track for its biggest slide in a month after Fed Chair Jerome Powell said officials would begin a discussion about scaling back bond purchases. Fed policy makers also disclosed that two interest hikes are likely by the end of 2023, sooner than many thought.

Locally, investors are awaiting retail sales data for April and assessing the impact of tighter restrictions aimed at countering soaring Covid-19 infection rates. President Cyril Ramaphosa on Tuesday extended a night-time curfew, reduced the permitted attendance at public gatherings and restricted alcohol sales as he moved the country to the third level of a five-stage virus-alert system.

Anglo American dropped 2%, to cause the largest drag on the benchmark gauge, and BHP fell 1.1% as an index of industrial-metals miners slid 1.5%, declining for a third session.

A gauge of precious-metals producers dropped 2.8%, falling for an eighth day in the worst losing streak since February 2018, after gold capped the biggest drop in five months.

Gold Fields slumped 5.5%, AngloGold Ashanti dropped 3.1% and Harmony Gold Mining fell 3.5%. Impala Platinum Holdings tumbled 2.4% and Sibanye Stillwater dropped 2.3%.

Banks were dragged lower by the risk-off sentiment, with a sector index slipping 0.5%. FirstRand dropped 0.6% and Standard Bank Group fell 0.9%.

While fewer than 30 of the benchmark index’s 139 members were higher in early trade, the market’s decline was curbed by strength in local heavyweight Naspers, which gained 0.4%, while its Prosus NV unit added 0.4%.

Foreign investors have continued a recent spate of selling South African equities, disposing of a net R601 million ($43 million) of local stocks on Tuesday, according to exchange operator JSE Ltd., marking an eighth day of outflows.