Rand slides to 7-week lows, stocks gain

The Star Early Edition - - PRICES - Reuters BATS Aspen Bid­corp

THE RAND hit a seven-week low against the dol­lar yes­ter­day af­ter the ANC pro­posed at a pol­icy con­fer­ence to na­tion­alise the cen­tral bank and ex­pro­pri­ate land with­out com­pen­sa­tion.

The rand traded at R13.4396 to the dol­lar at 5pm, the weak­est since May 18.

But the weaker cur­rency sparked de­mand for shares in lo­cal com­pa­nies that earn the bulk of the profit over­seas, push­ing the bench­mark JSE in­dex nearly 1 per­cent higher.

Trea­suryOne cur­rency dealer, An­dre Botha, said the rand had been pres­sured by a stronger dol­lar ear­lier in the ses­sion and ex­tended losses af­ter re­ports that the ANC had agreed that the cen­tral bank should be state-owned.

The ANC also pro­posed that land ex­pro­pri­a­tion with­out com­pen­sa­tion should be al­lowed where it is “nec­es­sary and un­avoid­able”.

The party’s pro­posal on the cen­tral bank is likely to raise con­cerns about the in­de­pen­dence of the Re­serve Bank af­ter an anti-graft watch­dog rec­om­mended its man­date be changed to place more fo­cus on growth and not just in­fla­tion and the rand cur­rency.

On the bourse, the blue chip Top40 in­dex added 0.92 per­cent at 42 241.44 points and the broader all share in­dex was up 0.84 per­cent at 52 483.9 points.

Com­pa­nies such Bri­tish Amer­i­can To­bacco (BATS), drug­maker Aspen Phar­man­care and food­ser­vice firm Bid­corp were in de­mand thanks to a weaker rand.

was up 2.91 per­cent at R914.83, climbed 2.53 per­cent to R297.84 and picked up 4.5 per­cent to end the ses­sion at R316.65. These com­pa­nies earn the bulk of the prof­its off­shore and are con­sid­ered safe bets when the rand weak­ens.

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