Rand, bonds, JSE all suf­fer

Cape Times - - BUSINESS REPORT -

THE RAND weak­ened more than 2 per­cent yes­ter­day and bonds fell after the cur­rent ac­count deficit widened in the third quar­ter and power firm Eskom said it was con­sid­er­ing re­struc­tur­ing its debt, dim­ming in­vestor ap­petite for the cur­rency.

At 5pm, the rand bid at R14.1834 to the dol­lar, 37 cents softer than at the same time on Wed­nes­day. It ear­lier reached a ses­sion-worst R14.2050 after clos­ing at R13.85 overnight.

Sen­ti­ment to­wards the cur­rency was ini­tially hit by gen­eral risk off trade that weighed down most emerg­ing cur­ren­cies as wor­ries about the im­pact of the US-China trade war on global growth con­tin­ued to rip­ple through mar­kets.

Data show­ing the cur­rent ac­count deficit widened to 3.5 per­cent of gross do­mes­tic prod­uct in the third quar­ter, and a warn­ing by Eskom that it may re­struc­ture its debt quick­ened the rand’s slide to its weak­est since Novem­ber 16.

Gov­ern­ment bonds were also weaker, with the yield on the bench­mark bond due in 2026 ris­ing 9 ba­sis points to 9.065 per­cent.

Stocks touched six-week lows, track­ing world mar­kets which slumped on re­vived fears of a flare-up in US-China ten­sions fol­low­ing the ar­rest of a top ex­ec­u­tive of Chi­nese tech gi­ant Huawei. The all share in­dex fell 1.75 per­cent at 50 806.06 points. The Top40 in­dex lost 1.96 per­cent at 44 778.75. I Reuters

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