RAND STEADY, STOCKS LOWER

THE RAND steadied yesterday as a dollar rally stalled when details of last week’s US jobs report soothed jitters about a faster end to monetary stimulus in the US.

At 5pm, the rand was trading at R14.25 against the dollar, not far off its previous close of R14.26.

Analysts said the data from the US showed the country’s economy was on a strong footing but with no expected major spike in inflation. This allayed fears that the Federal Reserve might raise interest rates earlier than expected.

Prospects of rising interest rates hurt riskier currencies, such as the rand, that thrive on US rates remaining low because they benefit from the interest rate differential that increases their appeal for carry trade.

But Investec chief economist Annabel Bishop said that despite the session gains for the rand, Covid-19 concerns in emerging markets were “a key detriment”.

Fears over the spread of the Delta coronavirus variant have dented global sentiment in recent weeks.

South African scientists have said the Delta variant seemed to dominate new infections, with the country hitting a record of 26 000 new Covid-19 cases on Saturday.

The JSE blue-chip Top40 index lost 0.35 percent to 60 082.2 points and the all share index dropped 0.24 percent to 66 166.86 points.

Naspers and its subsidiary Prosus lost around 6 percent after ride-hailing firm Didi Global and a number of other newly US-listed Chinese firms found themselves the subject of cybersecurity investigations in China. This caused a slump in the stock of China’s Tencent, in which Prosus holds an almost 29 percent stake.

In fixed income, the yield on the benchmark 2030 government bond dipped 3 basis points to 8.9 percent.