File Image: IOL
File Image: IOL

WATCH: Eskom supply constraint dampens domestic economy outlook

By Compiled by Dhivana Rajgopaul Time of article published Mar 18, 2019

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JOHANNESBURG - The rand started the European session on the front foot on Friday as optimism regarding the US-Sino trade deal lifted emerging market currencies according to NKC Research. 

Investor sentiment improved on the back of reports that progress has been made between Beijing and Washington, raising hopes of an agreement after earlier concerns of a delay to April. However, the announcement by Eskom that load shedding will prevail throughout the weekend curtailed more decisive rand recovery as the supply-side constraint continues to dampen the outlook for the domestic economy and feeds into deteriorating business confidence. At the close of local trade, the rand quoted 0.6 percent stronger at R14.41/$, after trading in a range of R14.39/$ - R14.50/$. The rand traded slightly weaker overnight. Expected range today R14.30/$ - R14.50/$.

South African bourse

The JSE All Share (+0.5 percent) ended higher on Friday, led by large platinum (+3.1 percent) and gold (+2.1 percent) mining shares. In the overall emerging market sphere, the MSCI Emerging Market Index (+0.9 percent) traded higher. In local news, Anglo American Platinum (+5.1 percent) and AngloGold Ashanti (+4.3 percent) rose as South Africa’s labour court rejected a request by the Association of Mineworkers and Construction Union (AMCU) to hold an industry-wide strike.

Brent crude oil

The Brent oil price fell on Friday as concerns over the global economy and robust US crude output caused prices to weaken. At the close of local trade, benchmark Brent crude quoted 0.7 perecnt lower at $66.70pb. Crude prices traded firmer during Asian trade this morning.

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