Rand holds its own despite rating downgrade

The rand was a touch firmer against the dollar on Monday despite last Friday's credit rating downgrade from Fitch, suggesting the market had largely priced in the move.

The rand also took in stride Reserve Bank data showing net gold and foreign exchange reserves were lower at $40.471bn in November from $41.308bn in October.

At 08:47 the rand was at R14.3405/$, up 0.21% from Friday's close at 14.3710.

Government bonds however weakened, and the yield for the benchmark instrument maturing in 2026 climbed 5 basis points to 8.7%.

The rand held its ground in the face of Fitch cutting South Africa's sovereign credit rating by one notch to BBB- on Friday, the lowest investment grade category, citing the slowing economy and rising debt.

Peer Standard & Poor's kept its own rating at BBB- but changed the outlook to negative from stable, saying this reflected the view that economic growth might be lower than expected.

On the equities market, the JSE's Top 40 futures index was up 0.8%, pointing to a strong open for the actual index.

Rand to enter new week at 'worryingly weak levels'

The rand weakened on Friday in thin trade with US markets closed for Thanksgiving Day holiday, while stocks were set to edge lower along with emerging market peers.

The JSE's Top 40 futures index was down 0.28%, indicating the index would open 133 points lower.

By 08:45 the rand had weakened 0.13% to R14.3100/$, a fresh one-week low, extending the previous session's losses when the unit retreated more than 1% as emerging market currencies globally took a hit.

With little local data due in the session, combined with the lack of liquidity, traders expected the currency to drift weaker. Government bonds were also weaker, with benchmark issue due in 2026 adding 2.5 basis points to 8.54%.

South African Stock Market News - The Rand Fell

Rand on the back foot amid rate hike uncertainty

The rand fell against the dollar on Wednesday amid investor uncertainty over whether the South African Reserve Bank (Sarb) will raise interest rates this week.

Stocks opened 0.13% lower at 46 687 points on the Top 40 index.

At 09:30 the rand had slipped 0.19% to R14.3000/$, surrendering the gains of the previous session as the greenback climbed to a seven-month high.

US interest rates are expected rise before year-end. Government bonds were flat, with the yield on paper due in 2026 unchanged at 8.55%.

The market is divided over whether Sarb will leave benchmark rates unchanged at a policy meeting on Thursday. According to a Reuters poll, 21 of 35 economists predict rates will be held at 6.00% with the other 14 forecasting a hike. 

The rand has been on the ropes for most of 2015, losing over 20% against the dollar, but hiking rates to underpin the currency risks slowing an already struggling economy.

"The problem with rand weakness is that it starts a vicious circle, where investors choose to withdraw rand bond and equity investments to avoid further currency loss, which in turns drives further rand weakness," said Investec economist Annabel Bishop.

Statistics South Africa is to publish inflation and retail sales data on Wednesday, with consumer prices expected to have ticked up, but only slightly. That would support the case for delaying any rate hike to 2016.

Rand a touch firmer

The rand stretched gains early on Thursday as the dollar retreated following a holiday in the United States that kept in check the greenback's recent bull run, allowing emerging assets to consolidate.

Stocks looked set to open flat with the equity futures on the blue-chip Top-40 index, considered a precursor of the actual index, only inching up 0.06%.

At 08:45 the rand edged 0.06% firmer to R14.1515/$, just a touch off its firmest level since last Friday.

Government bonds were mostly firmer, cheered by the pause in dollar strength, with the benchmark paper due in 2026 shedding 0.5 basis points to 8.545%.

"Risk assets are the winners this morning, as we see dollar strength retreating against a basket of EM currencies," analysts at Nedbank said in a research note.

The imminent rate hike in the US remained a risk and was likely to restrict the rand from pushing past the 14.00 technical barrier, traders said. South Africa's statistics agency publishes gold and mining production figures for September at 11:30.

South African Stock Market News - Rand Traded

Rand up on China data boost

The rand traded firmer early on Wednesday as emerging assets shrugged off fears of a looming rate hike in the US, finding relief in encouraging economic data from China.

Stocks were on track to open at least 126 points higher with the equity futures on South Africa's blue-chip Top 40 index, considered a precursor of the actual index, rising 0.27%.

Bonds also gained as yields fell, with the benchmark government issue shedding 3.5 basis points to 8.555%.

By 08:45, the rand had gained 0.28% to R14.2150/$, edging further away from Monday's slide to a record low of 14.3860 triggered by firmer-than-expected jobs data from the United States.

The rand has been driven by offshore factors of late, with global markets bracing themselves for higher rates by the Federal Reserve, a move expected to draw investors away from riskier albeit high-yielding bets in developing economies.

Retail, investment and manufacturing data out of China early on Wednesday showed growth in the economy continued to slow but was stabilising.

Some traders expect commodity-tied currencies like the rand to come under pressure after a sharp selloff saw Zambia's kwacha tumbling 5% on falling copper prices.

South African Stock News - Rand Firm

Rand firm in quiet trade, stocks inch higher

The rand hardly moved against the greenback in early quiet trade on Tuesday as investors await clear leads and data releases for direction, while stocks opened a touch higher.

At 09:05 the rand had edged up 0.3% to R13.7405/$, a level last seen on October 28, according to Reuters data.

Although risky assets may get a slight boost from the equity market, the week is still packed with data and event risks which are squeezed towards the end of the week.

Stocks opened slightly higher with MTN Group, which is battling to reduce a hefty $5.2bn fine in Nigeria, rebounding 0.3% after the telecoms firm said the Nigerian authorities have renewed its operating licence.

The JSE Top 40 index added 0.33% to 48 497 and the broader All-share index was up 0.26% at 53 998.

After a light day on Monday, the fixed income market is expected to take its cue from the relative strength of Tuesday's weekly government auction.

South African Stock Market News - Rand Recovers

Rand benefits from dollar sell-off, stocks flat

The rand recovered from its weakest in nearly a month in early trade on Friday as investors returned to long positions after marginally weaker-than-expected US growth data took pressure off risky currencies.

At 08:37 the rand firmed 0.47% to R13.83/$, having fallen as far as 13.8950 the previous day as most emerging currencies dropped in risk-averse trade.

The rand had threatened to touch 14.00 before a US report which showed that growth expanded at 1.5% in the third quarter, slightly less than forecast.

"There is a good chance that last night's dollar sell-off may extend to 13.75 this morning but probably no further. Unsurprisingly we have seen decent local importer demand for dollars over the past couple of days due to month-end covering," Standard Bank currency strategist Warrick Butler said.

Investors will be waiting for local trade data, due at 14:00, for clues on how to play their positions.

South African Stock News - Rand Slips

Rand slips as Fed hints at December rate hike

The rand retreated on Thursday after the Federal Reserve signalled it may lift interest rates at its next policy meeting, reigniting fears that the move would trigger capital outflows from emerging markets.

At 08:45 the rand slipped 0.11% to R13.7300/$, having fallen as far 13.8025 as most emerging currencies fell on revived bets of a US rate hike by year end.

Yields on government bonds rose, with the benchmark paper due in 2026 adding 8.5 basis points to 8.395% after rallying to a one-week low in the previous session.

On the local bourse, the benchmark JSE Top-40 index opened a touch lower, led by gold mining companies as bets on possible US rate hike weighed on the price of the yellow metal.

The US Fed kept interest rates unchanged on Wednesday but hinted strongly at a December hike, lifting the dollar to a two-and-a-half-month high against a basket of currencies.

Offshore risk would come from US growth data for Q3 later in the session. Traders expected the figures to show momentum in the world's number one economy, bolstering the case for a December rate hike by the Fed.

Locally, September credit and money supply data showed demand slowing more than expected, further signs of subdued economic activity in Africa's most advanced economy.