Stocks hold steady as market awaits Fed decision

South Africa’s main stock benchmark was little changed in early trading on Wednesday as weakness in banks and index heavyweight Richemont countered gains in miners and index giant Naspers.

Investors are awaiting the conclusion of a Federal Reserve meeting to gauge the extent of central bank support for the economic recovery. The Fed is expected to maintain its dovish stance after earlier saying it will shift to a more relaxed approach on inflation. Central bank stimulus has been shoring up sentiment in the face of risks from the pandemic, the US presidential election and the possibility of a no-deal Brexit.

  • Diversified miners BHP and Anglo American lead the gauge for resource stocks, up 1%.
  • BHP rises 1.7% after the miner says it will benefit most from a global shift toward faster and more dramatic measures to address climate change, and aims to profit from doing so itself.
    • Anglo American +0.9%, Anglo American Platinum +3.3%, Impala Platinum +1.4%, Northam Platinum +1.8%, Gold Fields +0.5%, Exxaro Resources +2.1%.
  • Naspers extends gains to a sixth session, the longest winning streak since February 7. Stock climbs 0.3% as Tencent advances in Hong Kong. Naspers holds a minority stake in the tech giant.
  • Richemont falls for a second day, down 0.4% after adjusting for the stock going ex-dividend; SBG Securities downgrades the luxury company to sell.
  • Index for bank stocks falls 1.1%.
    • FirstRand -1.4%, Standard Bank -1.2%, Absa -0.8%, Nedbank -0.7%, Capitec Bank -0.3%, Investec -0.9%.
  • Discovery drops 2.2% after headline earnings fall 94% and company skips dividend payment on Covid uncertainty.
  • Foschini falls 4% as stock is downgraded by Nedbank.
  • Foreign investors were net sellers of South African stocks Tuesday, disposing of R366 million worth of shares, according to index operator JSE Ltd.
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