Rand plummets after downgrade

The rand began to fall immediately after ratings agency Moody’s downgraded SA’s sovereign debt status to Baa3 late on Friday evening.

Within 20 minutes of the news, the rand had lost 10c to the dollar, trading at R12.96/$, from R12.86/$.

Moody’s cited political uncertainty, low GDP growth and the “weakening of SA’s institutional framework”.

S&P Global Ratings and Fitch have already downgraded the country to junk status.

Earlier, the JSE closed firmer as it ended a negative week on an optimistic note.

The JSE all share closed 0.50% higher at 52,216.90 points and the blue-chip top 40 rose 0.31%. The platinum index gained 6.33%, general retailers 1.66%, the gold index 1.61%, food and drug retailers 0.94%, industrials 0.6% and banks 0.59%. The all share ended the week 1.27% weaker, but has gained 3.09% in 2017.

In commodity stocks, Kumba Iron Ore closed 4.36% higher at R158 and African Rainbow Minerals rose 2.36% to R78.84. British American Tobacco lost 2.36% to R901.25, while Imperial Holdings added 1.83% to R156.46.

Sibanye Gold rocketed 6.84% to R17.02, but Harmony shed 3% to R24.25. Anglo American Platinum rose 6.96% to R293.73 but Lonmin shed 2% to R11.76.

Barclays Africa was up 0.97% to R146.40 and Capitec 1.96% to R778.50. Old Mutual was 1.43% down at R32.34, with Discovery adding 2.25% to R127.71. Brait lost 4.27% to R66.75. In property, Capital & Counties gave up 1.29% to R48.35, Intu 1.56% to R43.42 and Hammerson 1.72%, to R96.71.

Naspers ended the day 1.28% higher at R2,683.03.

The benchmark R186 bond was last bid at 8.47% unchanged from before the Moody’s announcement.

Futures were flat despite a strong Dow opening. At 5.55pm‚ the local near-dated, top-40 Alsi futures index was 0.05% higher at 45‚850 points. The number of contracts traded was 24,990, from Thursday’s 24‚314.