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S.Africa stocks edge up, retailers sold off
November 20, 2012 / 3:50 PM / in 5 years

S.Africa stocks edge up, retailers sold off

* Platinum shares climb

* Indices rise by over 0.2 percent

JOHANNESBURG, Nov 20 (Reuters) - South African stocks were marginally stronger on Tuesday, as gains by platinum miners were partially offset by weak retailers such as Woolworths.

Coal of Africa dropped the most on the All-Share index after state utility Eskom, a key buyer of coal, said wildcat strikes had chocked demand from miners.

Retailers were hit on concerns their share prices have gained too much this year. High-end clothes and grocery retailer Woolworths, which has gained more than 70 percent this year, fell 3 percent to 67 rand.

“People are starting to see some of these retail shares as being a bit overpriced,” said Thys van Zyl, a portfolio manager at Thebe Stockbroking.

“If it keeps on with this trend we might see January, February being a tough time for the retailers.”

The benchmark Top-40 index rose 0.24 percent to 33,098.28 and the All-Share added 0.21 percent to 37,306.60.

Clothing retailer Foschini, which is up about 27 percent this year, fell lost 2.3 percent to 129.75 rand.

Discount apparel and furniture seller, Mr. Price, which is also up more than 70 percent this year, edged down 0.4 percent to 138 rand. said Thebe’s van Zyl.

Coal of Africa tumbled 6 percent to 1.64 rand. Fellow coal producer Exxaro shed 4 percent to 157.15 rand after Barclays cut its rating to “equalweight” from “overweight”.

On the other end, Aquarius Platinum extended a rally sparked by a Nomura upgrade in the previous session, climbing 6.7 percent to 6.04 rand.

Rival Lonmin also chalked up more gains following shareholder approval on Monday of $817 million rights issue to repair its scrawny balance sheet. Its shares added 5 percent to 39.65 rand.

In a research note to clients on Monday, Nomura raised its rating for Aquarius to “buy” from “neutral” and for Lonmin to “buy” from “reduce.”

Nomura said the wave of violent strikes that have swept South Africa’s platinum mines this year have reduced supply to such an extent that the price of the white metal and shares of companies that mine and produce it should rally.

Some 174 million shares were traded, according to the latest bourse statistics, with 148 companies gaining value and prices of another 137 falling. (Reporting by Helen Nyambura-Mwaura; editing by David Dolan)

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