SA stocks slide on US debt worries
Investors are preparing for shaky markets in the face of a prolonged US debt ceiling deadlock.
JOHANNESBURG - South African shares extended losses for the fourth consecutive day on Wednesday as investors bet that the dark cloud of the US budget stalemate would continue to hang over global markets.
The Top-40 index shaved more than 1.2 percent to 38,106.70 after dropping by a similar margin in the previous session. The All-share lost 1.1 percent to 42,779.87, its lowest in a month.
Some investors are betting the US political deadlock could drag on past the weekend, which may resort in panic selling next week, said Tony Cadle, portfolio manager at Ashburton Investments.
"That is what people are concerned about, that it could be another five to 10 percent lower between now and next Thursday if there is no resolution," said Cadle.
"The smart money will be buying between now and next Thursday and short-term traders will be selling because they know there is the possibility that the stocks will be down another percent or whatever."
Johannesburg-listed gold producers slid 2.7 percent after a positive run earlier this week. The spot price fell 1 percent as news that Janet Yellen would be the new head of the Federal Reserve bolstered the dollar.
AngloGold Ashanti, Africa's top bullion producer, lost 3.4 percent while Sibanye Gold closed 4.3 percent lower.
A total 207 companies declined in value, compared with 98 that gained through the trade of more than 159 million shares, according to preliminary bourse data.