File Photo: IOL
JOHANNESBURG - The rand firmed by 1percent against the dollar yesterday after the greenback weakened for a second consecutive session, while stocks firmed across the board tracking the stronger rand.

Comments by the US Federal Reserve chairman Jerome Powell on Friday suggested a slower pace of monetary tightening, putting pressure on the dollar.

At 5pm, the rand bid at R14.1336 cents to the dollar, 12cents firmer than at the same time on Friday.

“It’s mainly due to the slide in the dollar. I don’t believe it’s any local factors,” said Treasury One dealer, Andre Botha.

Powell said on Friday the US central bank was sticking with its strategy of gradual rate hikes to protect economic growth.

“It’s a better time for emerging markets,” said Afrifocus Securities derivatives trader, Cheslyn Francis.

He said emerging markets have attracted inflows despite the ongoing trade war between the US and China.

In fixed income, the yield on the benchmark government bond due in 2026 was down 3 basis point to 8.87percent.

On the bourse, the all share index closed 1.46percent stronger at 59655.56 points. The blue chip Top40 index rose 1.54percent to 53554.61 points.

Bullion producer Harmony Gold advanced 3.84percent to R23.52, followed by diversified miner Sibanye-Stillwater closed 3.98percent up to R8.36 as the spot price of the precious metal recovered. AngloGold Ashanti gained 2.58percent to R113.52.

Gold prices slid in the previous session when Powell reiterated the central bank’s intention to raise rates gradually.

Meanwhile, an index of major world stock markets rose to its highest level in more than five months yesterday after the US and Mexico struck an agreement that lowers trade tensions.

MSCI’s gauge of stocks in 47 countries across the globe climbed 1 percent, helped by gains in developed markets from the US to Europe and Asia. The broad index was at its highest level since March14.

The benchmark S&P500 and the Nasdaq indexes hit records, bond prices fell and copper prices rose as the US and Mexico agreed to overhaul the North American Free Trade Agreement.

- BUSINESS REPORT