JSE’s mining shares bloodbath

INVESTOR confidence in the mining industry hit rock bottom last week after Mineral Resources Minister Mosebenzi Zwane gazetted the Broad-based Black Socio-Economic Empowerment Charter for the South African Mining and Minerals Industry, 2017.

The industry saw a drastic outflow of capital amid a bloodbath on the JSE as the market digested the impact of the Mining Charter, through which the government aims to transform the mining industry.

Zwane said last week that the 2017 Mining Charter was an instrument of change and introduced new definitions, terms and targets.

The market was not convinced the government was acting in good faith and shareholders voted with their feet.

Harmony Gold declined 4.29 percent to R22.73 a share, Sibanye Gold dropped 4.3 percent to R16.02 a share, Gold Fields was down 4.47 percent to R44.83 a share while AngloGold Ashanti was down 4.66 percent to R140.40 a share.

Impala Platinum was down 3.37 percent to R36.13 a share, Northam Platinum declined by 2.42 percent to R44.40 a share, Anglo American Platinum was down 4.4 percent to R289.74.

Chamber of Mines vicepresident Steve Phiri said many investors raised concerns long before the gazetting. “South African investors have also been sceptical…

“Today we are seeing an outflow of capital, we are battling. We do not see growth. The lack of capital is about the lack of investor confidence.”

Peter Attard Montalto of Nomura International said: “It is not the reform step that the ratings agencies were looking for.”