MARKETS WRAP

THE RAND clawed back some lost ground yesterday with renewed optimism that China and the US would strike a trade deal outweighing a surprise third-quarter contraction in the local economy.

US President Donald Trump said yesterday trade talks with China were going “very well”, striking a more positive tone than on Tuesday when he said a deal might have to wait until after the 2020 US presidential election.

At 5.20pm, the rand was 0.34 percent firmer at R14.5870 to the dollar. It had slipped to a session low of R14.6980 on Tuesday as the 0.6 percent contraction to gross domestic product snapped the currency’s four-session winning streak.

A Reuters poll of analysts had forecast a marginal 0.1 percent quarter-on-quarter expansion.

A broad slowdown led by mining, manufacturing and agriculture, has reignited fears of credit downgrades, spooking investors that have been lured in by the currency’s high yield.

Bonds were firmer yesterday, with the yield on the benchmark 2026 debt down 5.5 basis points at 8.43 percent.

On the bourse, stocks rose alongside emerging market shares after a report suggesting some progress in Sino-US trade talks helped offset concerns about further delays to progress in curtailing their trade war.

The benchmark JSE Top40 index rose 1.06 percent to 48 809.33 points, while the broader all share index advanced 0.82 percent to 54 933.21 points.

Financial services company Discovery and grocers Shoprite were at the top of the blue-chip index with

gaining 4.03 percent to R113.52 while increased 3.46 percent to R131.79.

Telecommunications groups Vodacom Group and MTN Group made modest gains after the latter announced that it would “vigorously” oppose recommendations of the Competition Commission after the regulator instructed the two companies to lower data prices.

gained 1.31 percent to R114.42 while was up 0.95 percent at R86.82. Reuters

Discovery Vodacom Shoprite MTN

I