Property stocks lose more ground

The JSE all share closed weaker on Thursday, as property stocks dragged the market down for a second consecutive day.

After opening weaker, property stocks recovered at midday, before drifting lower towards the close. Little clarity has emerged about a negative research report on some companies within the sector, apparently set to be released by Viceroy Research. Market commentators said that companies in the Resilient stable were to be called out by Viceroy on their financials, in a similar scenario to that of Steinhoff.

Viceroy confirmed in a December 29 tweet that it would release a report on a “South African name”.

The all share closed 0.62% lower at 59,606 points and the blue-chip top 40 shed 0.65%.

Property was down 2.18%, banks 2.07%, general retailers 1.64%, financials 1.48%, food and drug retailers 1.45% and industrials, 0.77%.

The gold index rose 0.92% and resources 0.75%.

Steinhoff slumped another 10.6% to R6.75. The group said after the market’s close that it was considering the early redemption of outstanding debt notes to the value of R15bn.

Resilient ended down 4.37% at R128.53 after dropping as much as 22% during the day. The company said earlier it expected its interim dividend to end-December to rise 13%-13.5%.

Among companies in Resilient’s stable, Nepi Rockcastle fell 5.15% to R178.80 and Greenbay 5.33% to R2.13.

The rand was range-bound for most of the day as the market awaited developments from the ANC’s national executive committee meeting. The confirmation that President Jacob Zuma’s resignation as head of state was not discussed put a lid on further gains in the currency.

The rand was at R12.4376/$, from R12.4346/$ soon after the JSE’s close.

South African bonds were firmer as global bonds reversed recent weakness, which followed reports China would scale back purchases of US debt. China has denied this.

The R186 was last bid at 8.6%, from 8.635%, while the US 10-year treasury was 2.5627%, from 2.5553%.

The top 40 Alsi futures index dropped 0.71% to 53‚270 points. The number of contracts traded was 27‚465 from Wednesday’s 15‚268.