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South African Stocks Fall to Eight-Week Low on Egypt Contagion

Jan. 31 (Bloomberg) -- South Africa’s broadest stocks index fell to a seven-week low as protesters in Egypt tried to topple President Hosni Mubarak, causing Moody’s Investors Service to lower the nation’s rating and curbing demand for riskier assets.

The FTSE/JSE Africa All Share index fell 0.5 percent to 31,398.75 by the 5 p.m. close in Johannesburg, the lowest since Dec. 3. MTN Group Ltd., Africa’s largest mobile-phone company, led declines, retreating 2.4 percent to 123 rand, the lowest since Nov. 30. MTN has operations in Iran, Syria and Yemen.

Emerging-market stocks fell to a six-week low as Egypt’s political crisis prompted investors to reduce risk. As many as 150 people have been killed in the turmoil, Ibrahim al-Zafarani, head of the rescue and emergency committee at the Arab medical union, told Al Jazeera television. The demonstrations in Egypt are a sign that Mubarak’s appointment of the first vice president since his rise to power in 1981 and his naming of a new premier may not placate protesters.

“All the Arab nations are very cautious and uncertain,” David Shapiro, a director at the Johannesburg-based Sasfin Securities, said by phone. “The market is nervous that the unrest could spread to other parts of the Middle East and the oil-producing regions.”

Murray & Roberts Holdings Ltd., a South African construction company with operations in the Middle East, dropped 10 percent to 31.10 rand, the lowest since September 2006.

While events in Egypt have affected Murray & Roberts, concern about a lack of new projects in South Africa is aiding the decline, Shapiro said.

PPC Sales

“Investors here at home thought government investment expenditure would recover quickly after the soccer World Cup in June, but the government has delayed its spend as money is hard to come by,” said Shapiro.

The company’s stock fell the most in 11 years on Jan. 28 after saying payment problems on projects caused a loss in the six months through December.

Pretoria Portland Cement Co., South Africa’s largest cement producer, slumped to 31.20 rand, the weakest since Sept. 28. Cement sales in South Africa fell 5 percent in the quarter through December, the company said in a statement today.

Top regional news: {TOP AFRICA <GO>} Most-read stock market stories: {MNI STK <GO>} Emerging market stock indexes: {EMEQ <GO>} World equity index monitor: {WEI <GO>} South African equity stories: {NI SJS <GO>} Net purchases and sales of South African stocks by foreign investors: {SAEQ <Index> GP <GO>} To see emerging-market asset prices: {EMMV <GO>} South African foreign exchange: {TNI FX SAFRI <GO>} Top currency stories: {TOP FX <GO>} Top bond stories: {TOPH <GO>} South African market monitor: {OTC ZAR <GO>}

To contact the reporter on this story: Sikonathi Mantshantsha in Johannesburg at

To contact the editor responsible for this story: Gavin Serkin at

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