Bourse hits record high as rand slips

The Star Early Edition - - PRICES - Reuters

STOCKS hit a record high yes­ter­day, buoyed by the re­cent rally by heavy­weights such as Naspers with size­able for­eign earn­ings.

The shares ben­e­fited from the rand’s slip to a two-week low. As of 5.37pm, the lo­cal unit had dipped to R13.2250 to the dol­lar, 1.69 per­cent weaker than its close on Fri­day.

The bourse has been driven by for­eign flows into eq­ui­ties and earn­ings gar­nered off­shore, at a time when the coun­try’s econ­omy is in a re­ces­sion.

“It is the case that a hand­ful of shares not linked to the South African econ­omy’s for­tunes have done well,” said Feroz Basa, head of Old Mu­tual’s Global Emerg­ing Mar­kets Fund.

The JSE’s all share in­dex scaled a new peak of 55 366 in in­tra­day trad­ing, but gave up some of its gains to close 0.59 per­cent higher at 55 207.41 points. The Top40 in­dex was up 0.66 per­cent at 48 873.13 points.

Naspers, which holds a third of China’s Ten­cent, led the way, gain­ing 2.04 per­cent to R2 908.50. The stock – up 44 per­cent so far this year – hit a record high of R2•939.97 last week.

Richemont, which has risen more than 23 per­cent this year, was up 1.54 per­cent to R112.15.

The rand re­treated to its low­est since July 13 af­ter rat­ings agency Moody’s warned that while the rate cut on July 20 by the cen­tral bank would sup­port growth, it sig­nalled grow­ing po­lit­i­cal pres­sure on eco­nomic pol­icy.

“It’s con­fir­ma­tion that Moody’s sees mon­e­tary pol­icy as key to the rat­ing. And if they aren’t happy it means they might down­grade us in the fu­ture, but not now,” said cur­rency trader at Rand Mer­chant Bank, Jim Bryson.

In fixed in­come, the yield on the bench­mark 2026 paper rose.

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