Rand rally con­tin­ues, stocks re­treat

The Star Early Edition - - PRICES - Reuters

THE RAND gained yes­ter­day for a third con­sec­u­tive ses­sion as fad­ing ex­pec­ta­tions that the US Fed­eral Re­serve would hike in­ter­est rates again this year kept in­vestors keen on emerg­ing mar­ket cur­ren­cies.

At 5pm, the rand traded 0.62 per­cent firmer at R12.8451 to the dol­lar, hav­ing touched a ses­sion best of R12.82 be­fore stalling as traders held off on large bets ahead of a speech by US cen­tral bank chair Janet Yellen.

With no ma­jor lo­cal data re­leases or po­lit­i­cal de­vel­op­ments the rand looked to over­seas mar­kets for di­rec­tion and found it in con­tin­ued de­mand for high-yield­ing emerg­ing mar­kets as­sets driven by fur­ther signs of sub­dued eco­nomic growth in the US.

Weaker-than-ex­pected durable goods data from the US yes­ter­day dragged the green­back lower, al­low­ing the lo­cal cur­rency to shake off jit­ters lead­ing up to the ANC’s pol­icy con­fer­ence start­ing at the end of the week.

Min­ing shares were among the de­clin­ers on the bench­mark in­dex amid a flight out of safe haven as­sets as com­mod­ity prices slid, with spot gold price hit­ting its low­est level in nearly six weeks as a large sell or­der hit sen­ti­ment.

“Mar­kets glob­ally are fairly strong so there’s a risk-on en­vi­ron­ment and when­ever that hap­pens you of­ten see a stronger dol­lar and you’ll see peo­ple get out of safe haven as­sets such as gold,” said North Shore Cap­i­tal fund man­ager, Mark Loub­ser.

The bench­mark JSE Top40 in­dex dropped 0.54 per­cent to 45 113.21 points, while the all share in­dex was down 0.42 per­cent to 51 288.71 points.

The lo­cal bul­lion sec­tor fell 1.68 per­cent. Gold Fields lost 2.68 per­cent to R45.42 and Har­mony Gold lost 1.86 per­cent to R21.16.

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