South Africa Commodity Stocks Fall Most Since ’08 as Metals Drop

South African commodity stocks fell the most in more than six years, with Anglo American Plc leading declines, as global metal prices slumped.

The FTSE/JSE SA Resources Index of 19 mining companies and oil and gas producers slid 6.2 percent, the most since December 2008, to 20,860.23, the lowest level since July 2009. Tumbling commodity equities dragged the FTSE/JSE Africa All Share Index down 2.8 percent to 48,057.46, with more than two securities dropping for each one that gained.

The nation’s stocks slid with emerging markets that tumbled after the World Bank cut its outlook for global growth in 2015, sending copper and oil to the lowest levels since 2009, while nickel, zinc and silver erased more than 2 percent. South Africa’s economy is set to expand 2.2 percent in 2015, below the sub-Saharan African average of 4.6 percent, according to the World Bank forecasts. Global output will expand 3 percent, down from a projection of 3.4 percent in June.

“It’s all linked to the big selloff we’re seeing in metal prices,” Patrice Rassou, head of equities at Sanlam Investment Management, said by phone from Cape Town. “There are also concerns about global growth. You will have seen a lot of revisions in global growth numbers.”

Anglo American declined 8.8 percent, the most since February 2009, to 182.22 rand. African Rainbow Minerals Ltd., South Africa’s second-largest iron-ore producer, retreated 7.2 percent to 123.05 rand. BHP Billiton Plc declined 6.4 percent, the most since March 2009, to 221.82 rand, its lowest in more than 2 1/2 years.

Consumer Rebound

Consumer stocks slid, with six of the 10 companies in the FTSE/JSE Africa General Retailers Index falling. Truworths International Ltd. fell for a second day after saying like-for-like retail sales declined 0.8% in the 26 weeks through Dec. 28, dropping 0.7 percent to 76.80 rand.

Shoppers in South Africa are facing pressure from a weakening currency, rolling electricity blackouts and persistent unemployment. Retail sales slowed to 2.6 percent in November from a revised 3.2 percent the prior month.

Massmart Holdings Ltd., a food and general goods retailer and wholesaler owned by Wal-Mart Stores Inc., rose 3.5 percent to 158.85 rand after saying sales in the 52 weeks through Dec. 28 rose 10 percent. The Foschini Group Ltd., which sells clothes, rose 1.7 percent to 147.50 rand, a record high, after starting talks to make an undisclosed purchase.

Shoprite Holdings Ltd., Africa’s largest supermarket chain, dropped 0.9 percent to 173.01 rand after saying revenue increased 13 percent in the six months through December.

“Factors such as power cuts in November and slow economic growth will weigh on the retailers,” Alec Abraham, an analyst at Sasfin Securities, said by phone from Johannesburg. “Truworths numbers also show that the bad debt cycle has not yet turned.”

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