JOHANNESBURG - The South African currency advanced on Friday thanks to improved global risk appetite according to NKC Research.
However, gains were capped by local releases, including a wider budget deficit last month while the trade account slipped back into deficit territory. Treasury data showed that the July budget deficit rose to R99.1 billion, while state arms firm Denel confirmed on Friday that it has received a cash injection worth R1.8 billion, drawing the spotlight again to state-owned entities’ fragile financial positions and contingent liabilities to government. On the global front, however, risk-on mood received an assist after China’s Foreign Ministry spokesman said that the US and China continue to have “effective communication” on trade issues. At the close of local trade, the rand quoted 0.87 percent stronger at R15.17/$, after trading in range of R15.18/$ - R15.35/$. The rand traded little changed overnight. Expected range today R15.00/$ - R15.35/$.
South African bourse
The JSE All Share (+1.56 percent) tracked global stock marks higher on Friday, buoyed by hopes of easing trade tensions. In local news, Discovery (+6.6 percent) released a trading statement for year ended 30 June 2019, in which it cautioned that normalised profits are expected to fall by between 5 percent and 10 percent. In the overall emerging market sphere, the MSCI Emerging Market Index (+1.47 percent traded higher.
Brent crude oil
The Brent oil price fell during late trade on Friday, before demand prospects were boosted by an easing of US-China trade tensions, while a looming tropical storm in the Florida Panhandle weighed on the supply outlook. At the close of local trade, benchmark Brent crude futures quoted 0.87 percent lower at $60.46pb. Crude prices remained on the back foot.
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