Rand lower on the risk aversion sentiment, stocks are falling

JOHANNESBURG – The rand has weakened by more than 1% on Monday, in line with the decline in equities and some emerging market currencies, due to weaker statistics from the world's largest economies, the concern aroused by the tension between the United States and China has reduced the appetite of investors for riskier badets.

Equities followed their global counterparts who were less concerned about growth concerns and who remained in China. trade tensions.

The rand traded at 14.3425 for a dollar at 1512 GMT, 1.15% lower than its Friday close at 14.1800. The currency has reached an intraday high of 14.3800.

"It seems that hopes to see the rand maintain its momentum of appreciation … (were) as fleeting as discounts on Black Friday sales. The week's implied volatility of the currency against the dollar reached its highest level in three months, "the RMB said in a note.

The disappointing US employment figures released on Friday have pushed Wall Street down by more than 2%, adding to signs elsewhere in Asia and Europe of the loss of speed and the broader impact of the Sino-US trade war.

China has announced much lower-than-expected exports and imports in November, showing slowing global and domestic demand and allowing the authorities to take further action to prevent the country's growth rate from slowing too much.

While the arrest of Huawei's CFO raised concerns over its impact on Sino-US trade relations, the White House's White House trade advisor Peter Navarro said on Friday that the trade truce between the US and the US Sino-US arrest and Meng "constitute two separate events".

But he warned against an increase in tariffs if countries could not agree during the truce.

"There was a technical resistance around 2:27 pm earlier and that coincided with the arrival of New York. And once we crossed these levels, stop-losses were sold and we saw the rand climb up to 14:30, which is not surprising when liquidity is low. said Oliver Alwar, Forex chief broker at Standard Bank.

The bonds remained unchanged, the yield of the reference bond being due in 2026 to 9.170%.

The All Share index fell 1.15% to 50,449 points, while the index of the top 40 companies lost 1.24% to 44,448 points.

"There are so many moving parts that are affecting the market at the moment and this volatility is not expected to end soon," said Ryan Woods, equity trader at Independent Securities.

The MTN group, Africa's largest telecommunications company, is still in talks with the Nigerian authorities over a $ 8.1 billion dispute and a $ 2 billion tax claim with the aim of reaching an agreement.

MTN shares fell 2.89% to close at R83.89.

Gold stocks withstood the negative market and climbed 4% as bullion prices moved closer to the five-month highs.