Rand retreats

THE RAND backtracked against the dollar yesterday as forward momentum faded in the face of technical resistance levels and a lack of local data releases to drive sentiment.

At 5pm, the rand was bid at R12.9643 to the dollar, 1.44c softer than at the same time on Friday.

The rand has struggled to break through technical resistance around the 12.85 mark despite political uncertainty in the US dragging the greenback to 13-month lows and buoying demand for emerging market assets.

A surprise rate cut by the South African Reserve Bank last week had little effect on the currency and with only June producer inflation due later in the week, traders said they expected limited movements on the currency in either direction.

“Flows were non-existent last week. No one is doing anything other than what is necessary. The technical picture remains unchanged with lower highs and higher lows continuing to cause a convergence in price action,” said trader at Standard Bank, Warrick Butler.

Government bonds were weaker, with the yield on the benchmark paper due in 2026 up.

Meanwhile, stocks closed firmer, with market heavyweight Naspers among the gainers after it hit a new all-time high.

The benchmark JSE Top40 index firmed 0.54 percent to 48 058.35 points, while the all share index gained 0.38 percent to close at 54 368.62 points.

Naspers firmed 1.92 percent to R2 860, a record high, as it mirrored gains from China’s Tencent Holdings, in which it holds a major stake. Woolworths climbed 2.14 percent to R63.84.