Spike in global bond yields saps in­vestor con­fi­dence

Weekend Argus (Saturday Edition) - - FRONT PAGE -

THE rand recorded mild gains against the dol­lar yes­ter­day, with all eyes next fo­cused on de­vel­op­ments around the Wed­nes­day court ap­pear­ance of Fi­nance Min­is­ter Pravin Gord­han, who faces fraud charges.

Stocks sagged in line with shares else­where as a spike in global bond yields sapped in­vestor con­fi­dence and sig­nalled grow­ing ex­pec­ta­tions that US in­ter­est rates will rise be­fore the end of the year

The rand was 0.30 per­cent firmer at R13.8325 to the dol­lar af­ter trad­ing steady for most of the day. Bonds mir­rored the rand, with the yield on the bench­mark gov­ern­ment bond due in 2026 fall­ing 5 ba­sis points.

An­a­lysts said in­vestors were paus­ing af­ter South Africa’s medium-term bud­get pol­icy state­ment on Wed­nes­day and ahead of a week of po­ten­tial high po­lit­i­cal drama.

Gord­han is ac­cused of fraud­u­lently ap­prov­ing, when head of the rev­enue ser­vice, early re­tire­ment for a deputy com­mis­sioner.

Stocks fol­lowed global coun­ter­parts lower with the bench­mark Top 40 in­dex shed­ding 0.63 per­cent to 44,308.17. The broader All­share in­dex fell 0.67 per­cent to 50,797.70.

Vol­umes were thin with around 185 mil­lion shares chang­ing hands, well be­low last year’s daily av­er­age of 296 mil­lion. – Reuters

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