Rand firms, stocks dip 2% tracking Asia

Rand firmed against the dollar on Monday while stocks fell, tracking weaker Asian stocks amid worries that trade war tensions were starting to take a toll on economic growth in China.

The rand was 0.5% stronger at 14.44 per dollar at 10:05 GMT.

The rand gained ground on the weaker dollar after ratings agency Moody’s opted to hold off publishing a review of the country’s debt on Friday as planned.

“The dollar has fallen away and under pressure amid inflationary concerns. Moody’s delay in giving decision on our sovereign debt staved off risk-off sentiment and rather prompted risk sentiment,” said Afrifocus Securities portfolio manager Cheslyn Francis.

On the bourse, the top 40 index fell 2.35% to 46 164 points. The broader all share index was 2.01% weaker at 52 399 points.

“The markets are so erratic and still nervous as the trade war tensions never went away over the weekend,” said Cratos Capital analyst Greg Davies.

Asian shares slipped on Monday as worries over Sino-US trade disputes, a possible slowdown in the Chinese economy tempered optimism. Data released on Friday showed Chinese auto sales posted the biggest drop in seven years.

South African bourse heavyweight Naspers dragged the Top-40 index lower, falling 5.23% to R2 756, as Hong Kong’s Tencent Holdings, in which Naspers has a 31.2% shareholding, closed 1.94% lower.

Fast-food chain owner Famous Brands shed 4.41% to R97.50 as the company booked an impairment charge of R874 million ($61 million)before tax on its struggling UK Gourmet Burger Kitchen business.