South African stocks at record highs, retailers shine

September 12, 2013
Electronic board displaying movements in major indices is seen at Johannesburg stock exchange in Sandton
An electronic board displaying movements in major indices is seen at Johannesburg stock exchange in Sandton September 23, 2008. REUTERS/Siphiwe Sibeko

JOHANNESBURG (Reuters) - South Africa's shares closed rebounded on Thursday to hit their second record closing peaks this week as investors moved out of sinking gold producers and into sectors such as retail.

Discount retailer Massmart and generic drug maker Aspen Pharmacare led the upward drive, with both closing around 4 percent higher.

Johannesburg's blue-chip Top-40 index added 0.7 percent to 39,207.30, a record close. The broader All-share index gained 0.77 percent to 43,752.30, also a historic closing peak.

But South Africa's gold producers took a beating for a straight third day as spot bullion prices hit a four-week low on waning prospects of an imminent military strike against Syria and uncertainty over the time and pace at which the U.S. Federal Reserve will start to unwind monetary stimulus.

There is also uncertainty about the labour situation in the gold shafts. Companies and unions this week signed two-year wage agreements after a 3-day strike last week but the hardline AMCU union is not on board and has said its members could down tools.

The JSE's Gold Index dropped 3 percent as shares of major producers like AngloGold fell 3.5 percent to 129.80 rand. Gold Fields fell 4.5 percent to 48.13 rand, the worst performer on the JSE's Top-40 index.

"It looks like investors are shifting away from gold into other sectors such as retail," said Christie Viljoen, an economist at NKC Independent Economists.

Aspen gained 3.77 percent to close at 264 rand after earlier hitting a lifetime high, as the stock extended gains from Wednesday when it posted strong full-year earnings and detailed plans to expand into Russia and Eastern Europe.

Volumes picked up on recent days with around 192.5 million shares changing hands, according to preliminary bourse data. Advancers outnumbered decliners 195 to 105 with 51 shares unchanged. Data showed 16 stocks closed at new highs.