Rand starts the day slightly calmer after GDP shock

The rand — which weakened to R12.83 to the dollar on Tuesday from Monday’s R12.52, on the news the decline in SA’s first quarter GDP was 2.2% versus the expected 0.5% — was trading at R12.74 to the dollar on Wednesday morning.

The rand was at R14.93 to the euro and R17.08 to the pound at 7am.

Australia, in contrast to SA, reported first-quarter GDP growth of 1% which beat economists’ expectations of 0.9%.

Better than expected Australian economic growth buoyed Sydney’s ASX 200 index by 0.43%, with BHP gaining 1.89% to A$33.36 and South32 rising 0.92% to A$3.84.

The weaker rand helped BHP close 2.2% higher at R295.68 on the JSE on Tuesday. South32 closed 0.87% higher at R37.22.

Tencent was 0.71% higher at H$423 ahead of the JSE’s opening, indicating its 31%-owner Naspers is set for a fifth trading day of gains.

Aveng released details of its proposed R500m rights issue at 5.45pm on Tuesday.

Aveng is offering its shareholders 12 new shares for every share held at 10c each, setting its rights offer price at less than a fifth of the 53c its shares last traded at.

Allan Gray and Coronation have each committed to buying R100m of the rights offer shares, and other institutions have committed to a further R45m, indicating Aveng has already secured nearly half the amount it hopes to raise.

One of the conditions Murray & Roberts made in its proposal to acquire Aveng in an all-share deal valued at R1bn is that Aveng raise at least R300m via its rights issue.

Murray & Roberts has yet to convince its suitor Aton that acquiring Aveng is an attractive deal. Aton on Tuesday morning upgraded its R17 per share Murray & Roberts offer from “voluntary” to “mandatory”.

Aton’s ownership of Murray & Roberts was last reported at 44%.