Stocks end month on disappointing note

SOUTH African stocks wrapped up the month on a weak note on Friday, ensuring the main indices posted their first monthly weakening since January amid lingering concern over the economy.

SOUTH African stocks wrapped up the month on a weak note on Friday, ensuring the main indices posted their first monthly weakening since January amid lingering concern over the economy.

South Africa narrowly avoided slipping into recession this month, but there remains a lengthening list of problems for Africa's most developed economy, including weak growth, inflation, high household debt and labour unrest.

Dismal company earnings posted this month, including from index heavyweight Shoprite, have dulled the appetites of investors as developed markets such as the US begin to show more promise.

"Our market had been tracking Wall Street over the past few months, but that has not been the case lately," said Petri Redelinghuys, a trader at Inkunzi Investments.

"Offshore investors are saying, 'Why keep our money in South Africa when the US economy is picking up?' That sounds sensible, given high valuations and poor earnings results."

The benchmark JSE Top 40 index was down 0.46% at 45630, bringing losses for the month to about 1.3%.

The broader All Share index dipped 0.34% to 50959.

Mining shares featured on the decliners' list as industrial metal prices continue to falter on concern about demand from the world's top consumer, China.

Assore slipped 2.11% to R314.74, Anglo American Platinum lost 2.2% to R443.10 and Kumba Iron Ore lost 0.28% to R318.50.

Bidvest slumped 2.6% to R281.32 ahead of the release of this industrial conglomerate's annual results tomorrow.

On the upside, Aspen Pharmacare climbed 2.6% to R305.65 after the drug manufacturer flagged a 31% annual profit increase.

Activity was relatively robust with 166million shares traded and advancers outpacing the decliners 153 to 152.

European stocks advanced, posting their first monthly gain since May as drug manufacturers climbed, outweighing a slump in Tesco shares.

AstraZeneca climbed 2%, leading a gain by healthcare companies after a report that Pfizer may have resumed takeover talks.

Tesco fell 6.6% after lowering its full-year profit forecast and its interim dividend.

"Tesco's surprise announcement has been taken as a sign that competition in the sector is about to intensify at shareholders' expense," said Guy Foster, head of research at Brewin Dolphin Securities.

Twelve out of 18 national benchmark indices in Western Europe climbed on Friday. Germany's DAX added 0.1%, while France's CAC 40 gained 0.3%. The UK's FTSE 100 rose 0.2%. - Reuters and Bloomberg