Rand, stocks lifted by strong retail data
South Africa’s rand and local stocks strengthened on Wednesday as retail sales rose more than expected, helping ease concerns over dismal mining data a day earlier.
At 1600 GMT, the rand traded at R13.72 per dollar, 0.2% stronger than its previous close and continuing a strong start to 2019.
Retail sales rose 3.1% year on year in November, versus expectations for a rise of 2.5%.
“Today’s figures point to some improvement on the demand side of the economy off a low base in the final quarter of this year,” Nedbank economists said in a research note. “But the recovery in the production side remains slow and patchy.”
Mining production fell 5.6% year on year in November.
On the Johannesburg Stock Exchange (JSE), stocks rose as retailers outperformed.
Grocery retailer Pick n Pay rose 1.87% to R75.59, while clothing firm Truworths gained 1.61% to R89.08 and apparel and homeware retailer Mr Price increased 1.62% to R259.14.
Some retailers struggled to lift earnings and sales last year, as elevated household debts, higher fuel prices and an increase in value-added tax squeezed consumer income.
But Wednesday’s data showed Black Friday sales gave a boost to retailers in November.
The JSE’s Top-40 index ended up 0.6% at 47,665 points, while the All-share index rose 0.5% to 53,786 points.
Source: moneyweb.co.za