JOHANNESBURG - The South African currency capitulated to bearish pressure as recession signals across the globe and fears regarding an escalating trade war sent investors to trim risk exposure according to NKC Research.
The local unit escaped the brunt of weakening risk sentiment, although fears linger that more fiscal resources need to be injected into struggling parastatal Eskom. The National Treasury’s policy document dispelled any hopes of a quick resolution to the country’s deepening woes, which will weigh on Moody’s decision come November. At the close of local trade, the rand quoted 0.28 percent weaker at R15.36/$, after trading in range of R15.26/$ - R15.41/$. The rand traded on the backfoot throughout the overnight session. Expected range today R15.30/$ - R15.60/$.
South African bourse
The JSE All Share (+0.67 percent) ended on the front foot yesterday, as US stock futures pointed to a higher open. In local news, pharmaceutical firm Adcock Ingram (+4.86 percent) reported that its headline earnings for 2019 rose by 10.60 percent while also announcing that it had sold its investment in Ghana. In the overall emerging market sphere, the MSCI Emerging Market Index (+0.08 percent) traded higher.
Brent crude oil
The Brent oil price traded firmer yesterday as data by the American Petroleum Institute showed US oil inventories fell sharply last week. However, crude surrendered gains after the San Francisco Federal Reserve president voiced his concern over the strength of the US economy. At the close of local trade, benchmark Brent crude futures quoted 1.15 percent higher at $60.73pb. Crude prices traded weaker during Asian trade this morning.
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