South African Stocks Plunge as Tencent Fall Hits Naspers and Prosus

(Bloomberg) -- South Africa's main stock index halts a four-day rally, falls 1.3% by 9:15am in Johannesburg, as index heavyweight Naspers Ltd. drops 4.4% after U.S. President Donald Trump signed a pair of executive orders prohibiting U.S. residents from doing business with the Chinese-owned TikTok and WeChat apps beginning 45 days from now, citing the national security risk of leaving Americans' personal data exposed.

NOTE: Trump Widens China Tech Attack, Banning Tencent's WeChat, TikTok

Naspers holds a 31% stake in WeChat's owner, Tencent Holdings Ltd, which plunged as much as 10% in Hong Kong. Naspers subsidiary Prosus NV, which holds the company's stake in Tencent, retreated 5.4%.

“This directly impacts Naspers and Prosus via Tencent and similarly will dampen sentiment on tech,” says Casparus Treurnicht, a fund manager at Gryphon Asset Management in Cape Town. As Naspers and Prosus make up more than 20% of the benchmark index, “one should be worried.”

The fresh U.S.-China turmoil threatens to derail this week's rally in global shares. Better-than-forecast earnings and optimism on a coronavirus vaccine had helped lift a gauge of world equities to little changed for the year. Friday weakness trims the FTSE/JSE Africa all share's weekly gains to 2.2%, still set for a second consecutive week of advances.

• Gold and platinum stocks lead the gauge for mining firms lower for the second day, down 0.6%
  • NOTE: Gold Pares Weekly Gain After Rally to Record, Silver Retreats
    • AngloGold Ashanti Ltd. -2.5% after the company's first-half profit more than tripled as it reaped a windfall from this year's surge in gold prices.
      • NOTE: AngloGold Profit More Than Triples on Price Rally, Output Slips
    • Gold Fields Ltd -2.5%, Sibanye Stillwater Ltd. -1.4%, Impala Platinum Holdings Ltd. -1%, Anglo American Plc -0.3%, Anglo American platinum Ltd. -0.8%, Northam Platinum Ltd. -1.1%
    • Richemont falls 0.5% after vote on conditional share capital increase. British American Tobacco Plc -1%
    • Foreigners turn net buyers of South African stocks Thursday, purchasing 69m rand worth of shares, according to index operator JSE Ltd.

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