Rand rally continues, stocks retreat
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.