South Africa’s benchmark FTSE/JSE Africa All-Share Index (TOP40) fell the most in 20 months as stocks, currencies and bonds in most emerging markets tumbled amid concern the U.S. Federal Reserve will reduce stimulus.
The 166-member gauge slumped 2.9 percent to 39,738.54 by 4:02 p.m. in Johannesburg. At close at this level will mark the biggest one-day decline since September 2011 and the lowest since May 3. None of the stocks on the FTSE/JSE Africa Top-40 Index of the largest shares in South Africa rose.
“South Africa is falling alongside global markets, in particular global emerging markets, on mounting fears that central banks will struggle to keep the global recovery on track,” Ryan Wibberley, head of equity dealing for frontier and emerging markets at Cape Town-based Investec Asset Management, said in an e-mailed response to questions.
The MSCI Emerging Markets Index fell 1.8 percent to the lowest level on a closing basis since Sept. 6. Standard & Poor’s raised its outlook for the U.S.’s AA+ credit rating to stable from negative, boosting odds the Fed will reduce stimulus that fueled demand for emerging-market assets. The Bank of Japan left unaltered the one-year fixed-rate loan facility it has tapped seven times amid a surge in volatility the pushed higher bond yields from a record low in April.
For every stock that rose on the all-share gauge today, more than 10 declined, data compiled by Bloomberg showed. BHP Billiton Plc, the world’s biggest shipper of steelmaking coal, slid 2.8 percent. SABMiller Plc, the world’s second-largest brewer, slumped 3.1 percent. The all-share indexes’s 30-day historical volatility, a measure of swings in the gauge, rose to 20, the highest since December 2011.
The spot price of gold declined as much as 1.5 percent, while platinum dropped as much as 2 percent. “The JSE is considerably weaker as commodities retreat and appetite for risk reduces sharply,” Wibberley said.
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