JOHANNESBURG - The South African rand traded on a more bullish tone during the European session, mainly benefitting from dollar weakness – but appeared vulnerable as it hovered near 11-month lows according to NKC Research.
Weak economic fundamentals are weighing on investors’ minds as Moody’s November credit review draws near. The rand rate is forecast to end the year at R14.65/$, on average about 9.4 percent weaker against the greenback than in 2018. At the close of local trade, the rand quoted 0.67% stronger at R15.32/$, after trading in range of R15.32/$ - R15.47/$. The rand traded firmer overnight. Developments elsewhere are likely to provide directional guidance as today’s inflation print is expected to show that consumer prices remain subdued in July. Expected range today R15.20/$ - R15.50/$.
South African bourse
The JSE All Share (-0.1 percent) ended lower yesterday, dragged by large consumer goods shares. Shoprite’s share price dropped by 9.25 percent after the local retailer’s earnings results for the year ended 30 June 2019 missed market expectations. Headline earnings per share fell by 19.6 percent to 780.8 cents in 2019, amid local inventory shortages and currency devaluations across the continent. In the overall EM sphere, the MSCI EM Index (+0.24 percent) traded higher.
Brent crude oil
The Brent oil price traded lower yesterday, as it tracked falling global stock markets. However, prices rebounded in the US session on hopes that US-China trade tensions would ease. At the close of local trade, benchmark Brent crude futures quoted 0.95 percent lower at $59.26pb. Crude prices extended gains during Asian trade this morning.
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