South African stocks recover with global peers, retailers lead

JOHANNESBURG (Reuters) - South African stocks, led by blue-chip retail shares such as Truworths, rose on Tuesday in line with a global rebound after reports on manufacturing, business spending and housing added to signs of a pick-up in U.S. economic activity.

Snapping four straight sessions of decline, the benchmark Top-40 index added 1.17 percent to 34,187.43. The broader All-share index rose 1.07 percent to 38,484.19.

Retailers were among the biggest Top-40 gainers, with Truworths bounding 4.4 percent higher to 82.53 rand. Woolworths climbed 3.1 percent to 60.62 rand.

"Woolworths and Truworths have been hard hit not just in last week's pull back but in the last three months when foreigners sold every retail share they could find," said Abri du Plessis, chief investment officer at Gryphon Asset Management in Cape Town.

Both shares are also in a technical rebound from oversold territory, according to Reuters data. Truworths remains down about 24 percent in the year to data

The sector has been hard hit this year by a poor economic outlook for Africa's largest economy, reflected in poor retail sales data, and fading hopes for a domestic interest rate cut which could boost consumer spending.

South African gold and platinum producers extended losses as the bullion price eased in the face of a rising dollar and amid domestic nervousness over upcoming wage talks.

An exception was world No. 4 platinum producer Aquarius, which added 4.6 percent after it announced a one-year wage agreement with the National Union of Mineworkers which will see increases just above inflation - a rare deal in an industry rocked by labour unrest and huge pay demands.

The dollar and global shares recovered on the positive spate of U.S. data and markets also got a lift from Monday's remarks by two policymakers with the U.S. Federal Reserve who downplayed the notion of an imminent end to the central bank's money-printing.

Source: http://news.yahoo.com/south-african-stocks-recover-global-peers-retailers-lead-155722383.html

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