EMERGING MARKETS

THE RAND firmed against the dollar yesterday thanks to a rally in riskier assets globally even as poor manufacturing data at home highlighted the blow to the economy from a coronavirus lockdown.

At 5pm the rand was 0.12 percent firmer at R16.90 to the dollar, after hitting a four-week high of R16.7975 earlier.

“Markets continue to seesaw, flipping between risk-on and risk-off at the blink of an eye,” Bianca Botes, executive director at Peregrine Treasury Solutions, said in a note.

“Gold eased from nine-year highs on Thursday, assisting emerging market currencies to recover some ground after weakening earlier in the week.”

The rand largely ignored data showing South Africa’s manufacturing output fell 49.4 percent year on year in April, reflecting the impact of a nationwide lockdown on the recession-hit economy.

The JSE lost steam after surging for three consecutive trading days this week as poor manufacturing data and a global surge in coronavirus cases caught up with the market.

The JSE all share index closed down 0.15 percent to 55 787.9 points while the Top40 companies index slipped 0.04 percent to end the day at 51 536.91 points.

The JSE’s gold index, which represents 5 top gold mining companies, was at an all-time high on the back of rise in gold prices globally as investors shunned equities and parked money in safe haven. The index went up 3.5 percent, but pared some gains to settle down 0.4 percent from the previous close at 6pm.

In fixed income, the yield on the benchmark 2030 government issue lost 3.5 basis points to 9.65 percent.

Meanwhile, Russia’s rouble firmed again and most other emerging market currencies attempted to gain against a weaker dollar. I Reuters