Join Moneyweb Editor Ryk van Niekerk, economists Dr Iraj Abedian and Isaah Mhlanga and tax practitioner Yolandi Esterhuizen on Thursday, February 25 at 11h00 in a free webinar analysing the budget. Registration is essential.

SA stocks post biggest drop this month on Tencent effect

Tencent lost as much as 6.7% in Hong Kong on Tuesday.
Image: Dwayne Senior/Bloomberg

South Africa’s main stocks index declined 1% by 9:53 a.m. in Johannesburg, the biggest intraday decline in 2021, after a slump in Tencent in Hong Kong pulled benchmark giant Naspers and its subsidiary, Prosus NV, lower.

Tencent lost as much as 6.7% in Hong Kong on Tuesday, as traders took profit after Monday’s 11% surge, which was Tencent’s biggest in almost a decade. Investors were also concerned by comments by an adviser to China’s central bank indicating that excessive liquidity and ultra-low borrowing costs were creating bubbles in the stock market.

Moneyweb Insider INSIDERGOLD

Subscribe for full access to all our share and unit trust data tools, our award-winning articles, and support quality journalism in the process.

Choose an option:

R63 per month
R630 per year SAVE R126

You will be redirected to a checkout page.
To view all features and options, click here.

A monthly subscription is charged pro rata, based on the day of purchase. This is non-refundable and includes a R5 once-off sign-up fee.
A yearly subscription is refundable within 14 days of purchase and includes a 365-day membership.

Click here for more information.

Naspers fell 3.5% from a fresh record close, the biggest decline since December 28, and causing the strongest drag on the overall market. Prosus, which holds Naspers’ 31% stake in Tencent, declined 3.3%, the biggest drop in more than two weeks.

Globally, risk sentiment took a beating as investors mulled a possible delay in the planned US fiscal-relief package against a backdrop of concerns that some markets are overextended. South African stocks have spent their longest period in technically overbought territory since 2005, with the relative strength index on the benchmark index above the level of 70 that signals to some traders that gains may be excessive for 14 days in a row. The sequence was snapped Tuesday, as the RSI dropped to 67.

Sibanye Stillwater joined platinum and gold companies to pull miners lower for a third day, with the sector index dropping 0.3%.

Sibanye retreated 2.8% to its lowest since December 31. Peers in the gauge of platinum stocks dropped 1.1% to a two-week low. Northam Platinum -0.6%, Impala Platinum +0.3%, Anglo American Platinum -0.4%, Royal Bafokeng Platinum -2.2%.

Sub-index for gold companies dropped 0.4% as investors counted down to this week’s Federal Reserve policy meeting, and tracked the Biden administration’s efforts to deliver a $1.9 trillion Covid-19 relief proposal.

Gold Fields -2%, Harmony Gold -1%, DRDGold -2%, Pan African Resources Plc -1.6%.

Index heavyweight Richemont dropped 0.7%. Sasol retreated for a fifth consecutive session, the longest losing streak since October 16, as oil prices slipped with a resurgent Covid-19 outbreak in some regions and a slow roll-out of vaccinations weighing on the demand outlook, offsetting tightening global supply.

An index of general retailers halted a three-day rally, falling 0.4%

Mr Price -1.6%, Foschini -0.9%, Truworths -0.9%, Motus Holdings -1%, Massmart Holdings -1%.

Foreigners remained net sellers of South African stocks for a fourth consecutive day Monday, disposing of R219 million worth of shares, according to exchange operator JSE Ltd.

© 2021 Bloomberg


You must be signed in to comment.






Follow us:

Search Articles: Advanced Search
Click a Company: