SA stocks lifted by miners as rates decision awaited

South Africa’s main stock index rose 0.64% as of 10:43 in Johannesburg, with miners contributing heavily to gains as investors seek to look past the latest tensions between Beijing and Washington. Banks are weaker before a central interest rates decision later Thursday.

A survey of 16 analysts surveyed by Bloomberg expect the South African Reserve Bank (Sarb) to cut the repurchase rate by 25 basis points.

“We are expecting the Sarb to cut interest rates by another 25bps today in an effort to support the ailing economy, while the US will release initial jobless claims this afternoon,” Bianca Botes, executive director at Peregrine Treasury Solutions, says in an emailed note.

The US issued an unexpected order Wednesday to close the Chinese consulate in Houston, ratcheting up tensions that have been simmering between the world’s two biggest economies.

• The gauge of mining stocks advances as rising gold prices lift gold producers, and as iron ore miners rally.
  • Anglo American up 2.33%, Gold Fields 1.66%, AngloGold Ashanti 3.94%, Sibanye Stillwater 4.07%, BHP Group 1%, Harmony Gold 5.76%, Northam Platinum 4.54%
• Index heavyweight Naspers rose 0.82% to provide biggest boost to the index, as partly-owned tech giant Tencent Holdings advanced in Hong Kong.
  • Naspers subsidiary Prosus NV, which holds the company’s 31% stake in Tencent, rises 1.86%
• Index of bank stocks weakened ahead of the rate decision:
  • FirstRand -0.77%, Standard Bank Group -1.36%, Capitec Bank -1.42%, Absa -2.1, Investec Plc -0.11%, Nedbank -0.83%
• Inflation dropped below the 3% bottom of the central bank’s target range in May, creating room for the monetary policy committee to lower its benchmark interest rate even further on Thursday

• Sasol fell 1.67%, providing biggest drag on the index after company released its full-year production and sales metrics for the year to June, and said it would be delaying operations at its Lake Charles Chemical Project by one month.
• Vodacom Group falls 1.19% after a trading update
• Foreigners were net sellers of South African stocks Wednesday, disposing of R651 million worth of shares, according to the JSE.

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