RAND STRONGER, OIL WEAKER

THE RAND gained yesterday, helped by a recovery in risk appetite globally after a steep loss on Monday.

But dollar strength and power cuts by struggling state-owned utility Eskom continued to pose risks for the rand.

As of 5.20pm, the rand traded at R16.15 against the dollar, 0.4 percent firmer than its previous close. On Monday it lost around 1.3 percent against the dollar.

Some investors use the rand as a proxy for emerging market risk, making it highly susceptible to swings in global sentiment.

On the JSE, the blue-chip Top40 index closed 0.33 percent higher on 60 359.4 points, while the broader all share index ended the day 0.3 percent up at 66 966.73 points.

Government bonds slipped, with the yield on the benchmark 2030 instrument rising 4.5 basis points at 10.25 percent.

Meanwhile, oil prices fell $1 (about R16.15) yesterday, with the demand outlook pressured by coronavirus lockdowns in China and growing recession risks, while a strong dollar made crude more expensive for buyers using other currencies.

Brent crude price was down $1.97, or 1.9 percent, at $103.97 a barrel by 5.17pm). US West Texas Intermediate (WTI) crude fell $1.90, or 1.8 percent, to $101.23 a barrel.

Early in the session, comments from the Saudi and UAE energy ministers boosted Brent and WTI up by over $1 a barrel.

Also, traders wondered whether the EU nations would all agree to bar Russian crude imports.

“As the EU continues to dither over whether or not they are going to embargo that Russian oil, that changes the calculus very much as well in both directions,” said John Kilduff, a partner at Again Capital.

“These are volatile times, the daily price bars are outsized these days,” he added.