MARKETS WRAP

RAND FIRMER ON CHINA MOVE

THE RAND firmed against the dollar yesterday as risk appetite picked up after China announced measures to minimise the economic impact from the coronavirus epidemic, but the unit remained vulnerable to concerns over a weak local economy.

At 5pm, the rand bid at R14.7329 to the dollar, 12 cents stronger than at the same time on Monday.

China’s central bank said yesterday that its huge liquidity injections through open market operations this week showed its determination to stabilise financial market expectations and restore market confidence.

The measures came after a coronavirus-led rout that erased almost $400 billion (R5.9 trillion) of market value from Shanghai’s benchmark index on Monday.

“Sentiment, however, remains bruised and any indication that cures for or containment of the coronavirus are failing, will trigger another selloff,” said RMB analyst Nema Ramkhelawan-Bhana.

The rand has tumbled 5.3 percent against the greenback since the beginning of the year, also hit by signs of weakness in the local economy.

The currency remained vulnerable as problems at power utility Eskom pile pressure on an already ailing economy.

In fixed income, the yield on the benchmark bond was down 1.7 basis points to 7.943 percent.

On the bourse, stocks rose to a more than one-week high, with retailer Steinhoff International topping the gainers following a report of a possible takeover bid for its European retail group Pepco.

Steinhoff soared to a more than seven-month high to record its biggest one-day rise in more than two years. It closed 47.22 percent firmer at R1.59.

The JSE all share index jumped 1.77 percent to 56 817.03 points, while the Top40 index climbed 1.98 percent to 50 892.53 points as risk appetite returned. Impala Platinum advanced 6.98 percent to R151.37, Anglo Platinum gained 6.53 percent at R1252.72, while Royal Bafokeng Platinum rose 4.55 percent at R53.27. I Reuters