Tweet September 11, 2018 8:10 pm Leave your thoughts
JOHANNESBURG – The rand firmed on Tuesday as emerging market currencies broadly staged a rally against the dollar following a deep selloff, with investors seeing an opportunity to buy the currency cheap.
Stocks were weaker on continued worries about the domestic growth outlook and lower gold prices globally.
At 1400 GMT, the rand was 0.6% firmer at 15.1250 per dollar, a touch softer than the session-best 15.0100 it reached as London traders came online.
The rand was also boosted by better-than-expected manufacturing output data which showed a 2.9% year-on-year expansion in July. Analysts polled by Reuters had expected a 1.1% year-year-on-year increase.
Manufacturing contributes 13% of gross domestic product and 11% of employment and is seen as key to achieving the economic growth that will help the country reverse record-high unemployment and avoid deeper credit downgrades.
Government bonds were flat, with the yield on the benchmark paper due in 2026 rising 0.5 basis points to 9.215%.
On the stock market, the Top-40 index closed 0.99% to 50,042 points while the broader all-share fell 0.95% to 56,174 points.
Gold and platinum producer Sibanye-Stillwater fell 4.23% to R8.84, Gold Fields weakened 4% to R33.09 while Impala Platinum fell 5.30% to R16.81.
Gold and platinum prices came under pressure as risk-off sentiment hit equities globally, in what some analysts say is a rotation after the sharp risk-currency selloff.
The gold index fell 3.05% while the platinum index dropped 2.61%.
Further losses were curbed by Aspen Pharmacare which closed up 2.20% to R271.55 after the drug maker said it was in discussions to sell its global infant formula business.
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