JOHANNESBURG - The South African rand was clobbered by souring risk sentiment as fears mount over a global economic recession according to NKC Research.
Meanwhile, yesterday marked the sixth day since South Africa announced a 21-day lockdown period – we estimate that, outside China, economies in a severe or partial lockdown account for nearly 50 percent of global GDP – restricting business and spending. Although all the regional shutdowns in China are set to end by early April, lockdowns took a heavy toll on the world economy in March and beyond. Deeply indebted SA will carry the wounds of the Covid-19 shock for a longer period. Given the upward pressure in spending related to containment efforts and the drag on revenue due to the slump in economic activity. At the close of trade, the rand quoted 0.20 percent weaker at R17.96/$, after trading in range of R17.82/$ - R18.07/$. The rand fell overnight, and today’s expected range is R17.90/$ - R18.40/$.
South African bourse
The JSE All Share (-1.7 percent) ended in the red yesterday, dragged by losses in large gold (-6.0 percent) and platinum (-5.0 percent) mining shares. In local news, Vodacom (+0.1 percent) slashed mobile data prices by up to 40 percent yesterday, after the Competition Commission said data costs were too high in SA. In the overall emerging market sphere, the MSCI Emerging Market Index (-2.51 percent) traded lower.
Brent crude oil
The Brent oil price fell as a result of oversupply fears yesterday, as energy traders scurry for storage facilities, with as much as 80 million barrels stowed away on oil tankers at sea, according to Reuters. At the close of local trade, benchmark Brent crude futures quoted 1.37 percent lower at $25.16pb. Crude prices traded firmer during Asian trade.