Photo: IOL
Photo: IOL

WATCH: Rand stumbles due to fears of a second wave of Covid-19 cases

By Dhivana Rajgopaul Time of article published May 12, 2020

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JOHANNESBURG - The South African rand traded weaker against a rising greenback yesterday. Investors opted for safer assets as optimism of a global recovery subsided after a second wave of the coronavirus hit countries in Asia and Europe according to NKC Research. 

The resurgence of new coronavirus cases is considered a key risk and the rand is therefore likely to remain volatile given its sensitivity to global factors. At the close of local trade, the rand quoted 0.66 percent weaker at R18.37/$, and drifted slightly weaker overnight. The expected range of the rand against the dollar today is R18.20/$ - R18.60/$.

South African bourse

The JSE All Share (-1.57 percent) dropped as global risk sentiment soured. The local bourse announced that it would provide temporary relief to companies facing financial difficulty because of the global pandemic. Some of the measures include reducing fees for new listings and extended payment to help alleviate liquidity pressures. In the overall emerging market sphere, the MSCI Emerging Market Index (+0.47 percent) traded higher.

Brent crude oil

The Brent oil price whipsawed to trade little changed during the European session. Prices were hoisted by Saudi Arabia’s pledge to deepen production cuts, but gains were reversed due to fears of a second wave in new coronavirus cases. At the close of local trade, benchmark Brent crude futures quoted 0.10 percent weaker at $30.30pb.

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