CASHBIL: 28,757 -654 (-2.22%)
South Africa's rand steadies after volatile trade; stocks rise
* Rand briefly firms more one percent in the session
* News on land expropriation sparks volatility
* Retailers lead stocks higher
(Updates prices, adds analyst)
JOHANNESBURG, Aug 28 (Reuters) - South Africa's rand held
steady against a weaker dollar on Tuesday as investor optimism
that a U.S.-Mexico deal will help avert a global trade war
boosted appetite for riskier assets.
Retail firm Woolworths led the bourse higher, as several
retailers rose on the back of demand in the sector.
At 1518 GMT the rand was largely unchanged at
14.1650 per dollar, after rallying briefly to 13.9525 earlier
after parliament withdrew an expropriation bill passed by in
2016 that allowed the state to make compulsory purchases of
The thrust of the bill, which had not been signed into law,
has been overtaken by a proposal by the ruling African National
Congress to change the constitution to allow the expropriation
of land without compensation.
Halen Bothma, an analyst at ETM Analytics, said trading was
largely range-bound up until the news on land expropriation.
"The market is very sensitive to news around the land
expropriation topic, which is understandable because of its
importance to the South African economy," Bothma said.
"(The rand) reacted strongly but it has erased those moves
as people have realised it doesn't change anything."
Having tumbled to 2-year lows just shy of 16.0000 mark
earlier this month, as the massive selloff in Turkish lira
spread to other emerging markets, the rand has seen
increased intraday volatility in response to news.
The rand was steady as traders eyed talks between the United
States and Mexico who agreed on Monday to overhaul the North
American Free Trade Agreement, putting pressure on Canada to
agree to new terms on auto trade and dispute settlement rules to
remain part of the three-nation pact.
In fixed income, the yield on the benchmark government paper
due in 2026 added 0.5 basis points to 8.875 percent.
On the bourse, the Top-40 index was up 0.61 percent
to 53,883 points while the broader all-share index rose
0.64 percent to 60,039 points.
Retailers Foschini, Truworths and
Woolworths all rose. Woolworths led the blue-chip
Top-40, closing 4.1 percent higher.
"We are getting the feeling that foreign investors are
coming into our market thinking that retail is where the value
is," said Greg Davies, a stock trader at Cratos Capital.
"Local fund managers have probably sold those stocks too low
and they have decided to start the bargain hunting here."
Building materials retailer Cashbuild bucked the
trend, falling 3.21 percent after reporting a 9 percent decline
in annual profit as costs rose and demand dipped.
(Reporting by Olivia Kumwenda-Mtambo and Patricia Aruo
Editing James Macharia)
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