South African stocks recovered on Wednesday, as resource stocks such as petrochemical group Sasol and mining company Assore were lifted by the weaker rand and short-term insurer Santam gained on a surprise rise in earnings. The stock market showed little immediate reaction to the release of South Africa's $121 billion budget, with the government cutting its growth forecast for this year to 2.7 percent.
The rand softened by around 0.9 percent, giving a boost to resource companies and other exporters, who benefit as the weaker currency lifts overseas profits. "Stocks have been bouncing around a fair amount, mainly on the back of a volatile rand," said Mohammed Nalla, head of strategic research at Nedbank Capital.
The JSE Top-40 index added 0.22 percent to 42,535.95 and the broader All-share index was up 0.13 percent at 47,017.19. Sasol gained 1.7 percent to 519.9 rand, both on the weaker currency and after the finance minister said a planned carbon tax would be delayed by a year to 2016. The petrochemicals company reaps a little over half of its revenue overseas.
Insurer Santam reported a surprise 4 percent increase in full-year earnings after booking a record level of premiums. Its shares gained 2.9 percent to 169.20 and, its highest daily percentage gain in about a month. Bucking the trend was transport company Imperial Holdings which fell more than 4 percent after it reported flat first-half profit, reflecting a slow-down in demand for trucks to haul merchandise across Africa. Its shares fell 4.25 percent at 160.7 rand and have lost 21 percent so far this year. Some 196 million shares were traded, according to preliminary bourse statistics with advancers outpacing decliners 159 to 145.
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