South Africa's rand hits one-week low on EM woes; stocks dip on MTN
* Rand hit by Argentina, Turkey woes
* Stocks snap 10-session rally as MTN saga weighs
(Updates rand, stocks, bond closing prices)
JOHANNESBURG, Aug 30 (Reuters) - South Africa's rand tumbled
to its weakest in more than a week on Thursday as financial
crises in Turkey and Argentina rattled sentiment toward emerging
markets and stoked another wave of selling on the local
Stocks fell as mobile operator MTN slid as much as
23 percent after Nigerian authorities ordered the South African
telecoms group to return $8.1 billion.
At 1520 GMT the rand was down 2.28 percent to
14.6850 per dollar, its weakest since Aug. 20.
"The entire EM is a sea of red," said currency trader at
Rand Merchant Bank Jan Sluis-Cremer.
"The rand's being dragged down by other emerging markets. We
saw Argentina implode overnight and that's sparked some selling
across the board and it seems like the rand is being used as a
proxy hedge," said Sluis-Cremer.
The Argentine peso crashed over 7 percent after a
investor confidence there collapsed following its request to the
International Monetary Fund (IMF) to speed up disbursement of a
$50 billion loan programme.
Sentiment towards emerging markets was also hurt by Turkey's
ongoing financial crisis, and the lira was amongst the
hardest hit by the fresh bout of investor nervousness, diving to
a two-week trough.
Concerns over the health of the domestic economy also put
pressure on the currency. South Africa's budget deficit in July
increased to 95.98 billion rand from 92.21 billion rand
shortfall a year ago, Treasury data showed.
Government bonds also weakened, with the yield on the
benchmark paper due 2026 up 10 basis points to 9.04
On the bourse, the Top-40 index was down 2.55
percent to 52,650 points while the broader all-share index
slipped 2.3 percent to 58,803 points.
MTN closed 19.41 percent at 86.50 rand.
Nigeria's central bank said $8.1 billion had been illegally
moved abroad because the company's bankers, who include South
Africa's Standard Bank's Nigerian unit Stanbic
, had failed to verify that Africa's biggest
telecoms company had met all the foreign exchange regulations.
Standard Bank denied any wrongdoing. Its shares fell 2.4
percent to 185 rand.
(Reporting by Mfuneko Toyana and Nomvelo Chalumbira
Editing by James Macharia)
First Published: 2018-08-30 11:41:49
Updated 2018-08-30 17:45:06
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