WATCH: Rand firms on fiscal reprieve
JOHANNESBURG - The rand firmed on fiscal reprieve as the Treasury indicated it will cut costs and rein in spending during Friday’s European session according to NKC Research.
The news was cheered by markets as rating agency Moody’s welcomed the developments; however, the local unit failed to escape souring risk sentiment that swept through emerging markets as the yuan slipped to a new 11-year low – dragging the rand weaker in after-hours trading. China announced retaliatory tariffs on the US as the tit-for-tat saga continues. In an escalation of the US-Sino trade war, China announced it will impose tariffs (5 percent - 10 percent, on top of existing rates) on $75bn worth of US goods on Friday, and reinstated tariffs and levies on auto imports in response to US actions earlier this week. At the close of local trade, quoted 0.72 percent stronger at R15.11/$, after trading in range of R15.08/$ - R15.27/$. Expected range today R15.25/$ - R15.50/$.
South African bourse
The JSE All Share (-0.35 percent) closed lower on Friday, after emerging market sentiment was dented by renewed trade conflict. Gold mining shares bucked the trend as Harmony (+4.65 percent) and Gold Fields (+2.68 percent) were lifted by buoyant precious metal prices. In the overall emerging market sphere, the MSCI Emerging Market Index (-0.20 percent) slipped.
Brent crude oil
The Brent oil price fell abruptly as trade war fears escalated after China announced retaliatory tariffs on $75bn worth of US goods. At the close of local trade, benchmark Brent crude futures quoted 0.88 percent lower at $59.62pb. Crude prices traded firmer during Asian trade this morning.