Rand hits 2015 levels, bourse advances

THE RAND firmed against the dollar yesterday, breaking through R12 to the dollar for the first time since mid-2015, supported by a weaker greenback and expectations the new leader of the ANC would rejuvenate the economy.

At 5pm, the rand bid at R11.9630 to the greeback, 15.43c stronger than at the same time on Tuesday.

The rand is trading at its best levels against the dollar since July 2015, according to Thomson Reuters data.

The local unit has surged since Cyril Ramaphosa won the race to succeed Jacob Zuma as ANC leader last month, putting him in pole position to become the country’s next president.

Ramaphosa has pledged to fight corruption and woo foreign investment. He is the country’s deputy president and would become the nation’s leader if he wins an election next year when Zuma is due to step down.

“The rand convincingly pierced the R12.00/USD key resistance level today (yesterday), reaching R11.92/ USD as the US dollar weakened on US economic policy concerns, with the greenback reaching around three year lows, following also ongoing revelations on US political issues,” said Investec chief economist, Annabel Bishop.

In fixed income, the yield for the benchmark government bond was down 1 basis points to 8.365 percent.

Meanwhile, stocks also benefited from positive sentiment from Ramaphosa despite heavy-weight Naspers weighing on further gains.

The benchmark JSE Top40 index ticked up 0.1 percent to 54 575.94 points, while the all share index lifted 0.24 percent to 61 623.13 points.

“We are seeing financials in particular and the likes of some of the industrials and retailers looking good,” said Independent Securities trader, Ryan Woods.

PSG Group advanced 4.96 percent to R275 and Lewis Group lifted 4.9 percent to R30.

Massmart Holdings climbed 3.48 percent to end the session at R149.39.

Further gains were curbed by rand hedge Naspers, which declined 1.33 percent to R3 700 amid a strong rand.

Rand-hedged stocks, which make the bulk of their revenue outside the country, tend to weaken as the currency strengthens.