SHOPRIT: 12,695 +131 (+1.04%)
South Africa's rand steadies, stocks down
JOHANNESBURG, July 30 (Reuters) - South Africa's rand
steadied on Tuesday as traders, eschewing big transactions
despite poor unemployment figures and a warning of another loss
from power utility Eskom, stayed on the sidelines ahead of a
U.S. monetary policy announcement.
At 1515 GMT, the rand traded at 14.1800 per dollar,
not far off Monday's close of 14.1650.
"Surprisingly, the dire (unemployment) number had no effect
on the currency as (Wednesday's) anticipated U.S. Federal
Reserve interest rate cut overshadows local market events for
the time being," said Bianca Botes, a treasury partner at
Peregrine Treasury Solutions.
The unemployment rate jumped to its highest since the global
financial crisis more than a decade ago, piling more pressure on
President Cyril Ramaphosa’s pledge to turn around a shrinking
Meanwhile, power utility Eskom said it expected to make a
loss of around 20 billion rand ($1.4 billion) in the 2019/20
financial year, a similar loss to the previous year due to a
steep increase in debt-servicing and fuel costs.
Rating agencies Fitch and Moody's last week both warned
about fiscal pressure on South Africa and highlighted Eskom as a
risk, pressuring the rand.
Equities closed weaker with the Johannesburg Stock
Exchange's all-share index down 1.37% to 57,242 points,
while the Top-40 index fell 1.48% to 51,207 points.
Leading the declines was South African retailer Massmart
which fell almost 20% before closing down 15.45% at
49.80 rand per share after it warned half-year operating profits
would hit a 13-year low.
South Africa's second biggest insurer Old Mutual
fell 5.55% to 19.24 rand after the High Court ruled its
dismissal of former CEO Peter Moyo was unlawful.
On the upside, Africa's biggest retailer Shoprite
closed up 5.75% at 157.22 rand after it forecast performance
would improve in the second half.
In fixed income, the yield on the benchmark government bond
due in 2026 edged down to 8.31%.
(Reporting by Olivia Kumwenda-Mtambo and Onke Ngcuka; editing
by John Stonestreet)
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