Stocks edge lower as Sanlam, Aspen slide after results

South Africa’s main stock index drops 0.1% as of 10:11 a.m. in Johannesburg, as Sanlam pulls insurers lower following its earnings and Aspen slides after skipping its annual dividend, countering a fifth day of gains for banks.

Wednesday’s 1.4% rally in South African stocks was accompanied by a return to buying by foreign investors, who ended eight days of outflows, according to bourse operator JSE Ltd.

Sanlam snaps a three-day rally, falls 2.3% — the biggest intraday decline in a week — after the continent’s largest insurer released its first-half earnings. The company says growth in new business volumes will probably taper off toward the end of the year amid rising unemployment and a deteriorating South African economy.

  • Index of insurers falls 2.2%. Old Mutual -2.9%, Discovery -1%, Liberty -0.9%.

Diversified mining giant BHP falls 1.5%, while Anglo American drops 1.4%. Two stocks are biggest drag on overall market.

  • Mining index -1.4%. Impala Platinum Holdings -2%, Anglo American Platinum -3.3%, Sibanye Stillwater -1.1%, Northam Platinum -0.8%, Glencore -0.7%, African Rainbow Minerals -0.6%, Exxaro Resources -0.3%.

FirstRand rises 1.5%, as investors look beyond a 38% drop in profit in its first half, as well as the bank’s expectation that its earnings will face “acute pressure” for the rest of 2020. Index of bank stocks climbs for a fifth day, its best winning streak in more than four months. Standard Bank Group +3.1%, Absa Group +2.9%, Nedbank Group+2.5%, Capitec Bank +2%.

Aspen slumps 5.1% after the drugmaker withholds its annual dividend for a second year in a row.

Local traders are on the lookout for current account, manufacturing and mining data due Thursday. Globally, investors will be on guard for any signs that the selling in stocks may resume. Eyes will also be on the European Central Bank’s latest policy decision and weekly jobless claims data in the US.

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