RAND GAINS, JSE NEARS RECORD

THE RAND recovered yesterday from the previous session’s four-week low against the dollar as global bond markets calmed after last week’s sell-off.

At 5.20pm, the rand traded at R14.92 against the dollar, 1.3 percent firmer than its close on Friday, when it slipped to its weakest since February 1.

Progress on US President Joe Biden’s $1.9 trillion (about R28.6 trillion) economic stimulus plan, now awaiting Senate approval, bolstered risk appetite. Subdued moves in US treasury yields on the day also tamed risk selling.

“The rand opened stronger this week after optimism around the US stimulus package prompted the repetitive and familiar shift to ‘risk-on’”, said DailyFX analyst Warren Venketas.

“Lesser restrictions on local lockdown measures and a relaxed US bond market aided the positive start for the rand.”

On Sunday, President Cyril Ramaphosa moved the country from alert level 3 to 1 and said the country had signed an agreement with Johnson & Johnson to secure 11 million Covid-19 vaccine doses.

Bonds also recovered. The yield on the benchmark 2030 government bond, which touched its weakest in four months on Friday, was down 11.5 basis points at 8.94 percent.

In equities markets, shares closed near record highs as restrictions lifted and the country secured more Covid-19 vaccines.

This pushed general retail and food producer stocks up by 1.4 percent, buoyed by the prospect of a return to more normal alcohol sales.

Stocks were also supported by positive earnings and stronger commodity prices, particularly spot gold, palladium and platinum. The mining index closed 2.16 percent up.

Diversified service provider Bidvest Group rose 2.89 percent after reporting a 6.1 percent rise in profit for the six months to December 31.

The JSE benchmark all share index rose 2.12 percent up at 67 536.96 points, near a record high of 67 736 points, while the Top40 index gained 2.23 percent to 62 107.04 points.