WOOLIES: 3,512 +32 (+0.92%)
South Africa's rand pauses recent slide, stocks down
JOHANNESBURG, Aug 20 (Reuters) - South Africa's rand firmed
on Tuesday, pulling back from an 11-month low as long dollar
investors took profits and awaited further clues on the outlook
for the global and local economy.
Stocks closed weaker, dragged down by local retailers.
At 1520 GMT the rand was 0.89% stronger at 15.3325
The rand has lost more than 7% since Aug. 1, battered by
local and global issues, breaking through a succession of
technical milestones on its way to 15.50, a pivot-point last
reached in September 2018 that has triggered stop-losses held by
importers and opened the path to a deeper retreat.
But on Tuesday the currency's slide paused. A paucity of
data, low liquidity, and fresh hopes that a world recession will
not materialise attracted buyers.
The focus now turns to the Jackson Hole seminar where U.S.
Federal Reserve chair Jerome Powell is expected to speak, and to
a Group of Seven summit to be held in France this weekend for
clues on what steps policymakers will take to bolster growth.
Locally, South Africa's statistics agency publishes July
inflation figures on Wednesday, and, while limited price growth
this year saw the central bank cut lending rates last month, a
recent bout of currency volatility may reignite bets that the
cutting cycle will be short-lived.
In equities, the broader All-Share index was down
0.2%, while the benchmark Top-40 index declined 0.21%.
Leading the blue chip decliners was South African retailer
Shoprite, which fell more than 9.25% to 126.86 rand
after missing its full-year earnings forecast.
"The whole retail market is feeling the pressure and I think
there's a lot of negative sentiment," said Nick Kunze, portfolio
manager at Sanlam Private Wealth.
Supermarket chain Pick n Pay shed 5.7% to 56.84
rand, while food and clothing group Woolworths declined
3.4% to 52.10 rand.
In fixed income, the yield on the benchmark 10-year issue
dropped 4.5 basis points to 8.39%.
(Reporting by Olivia Kumwenda-Mtambo and Onke Ngcuka
Editing by James Drummond)
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