The rand and local stocks retreated early on Thursday, as risk appetite weakened across global markets. Picture: Steve Buissinne/Pixabay
The rand and local stocks retreated early on Thursday, as risk appetite weakened across global markets. Picture: Steve Buissinne/Pixabay

Rand, local stocks retreat early on Thursday as global risk appetite weakens

By Reuters Time of article published Oct 21, 2021

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THE rand and local stocks retreated early on Thursday, as risk appetite weakened across global markets.

At 0723 GMT, the rand traded at 14.4825 against the dollar, down roughly 0.5 percent on its previous close. The Johannesburg Stock Exchange's (JSE) Top-40 index was down almost 1 percent.

"Risk appetite has deteriorated overnight, with equities and futures a sea of red, and most emerging market currencies retreating against a broadly firmer US dollar," ETM Analytics said in a note.

Asian stocks slipped on Thursday as the upbeat mood that carried the Dow Jones to a record a day earlier ran out of steam, replaced by fresh worries about the weakening Chinese property sector as a possible default by China Evergrande looms within days.

The rand had gained on Wednesday, as data showing consumer price inflation quickened slightly to 5.0 percent last month reinforced the view of some traders that the central bank would raise interest rates next month.

The South African Reserve Bank has kept its main lending rate on hold at a record low of 3.5 percent for its past seven monetary policy meetings, lagging other emerging market central banks like those of Russia and Brazil which have tightened policy substantially.

The government's 2030 bond also dropped early on Thursday, with the yield rising 4 basis points to 9.395 percent.

REUTERS

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