South Africa's rand firms on renewed risk appetite
JOHANNESBURG, March 12 (Reuters) - South Africa's rand
firmed on Tuesday, supported by renewed risk appetite after
potential progress on Brexit in Britain and as the dollar
weakened after U.S. consumer price data.
Stocks also gained alongside emerging-market rivals, with
drugmaker Aspen Pharmacare leading the gainers as it
clawed back gains after a sell-off last week.
At 1501 GMT, the rand traded at 14.2975 per dollar,
0.33 percent firmer than its New York close on Monday.
Risk appetite was boosted after Brussels agreed to
last-minute changes to an updated Brexit deal with British Prime
Minister Theresa May on Monday night, raising hopes the
government would secure a deal before the Brexit deadline in
less than three weeks.
But Britain's Attorney General Geoffrey Cox said the Brexit
backstop remained unchanged despite assurances from the European
Union, reigniting worries that the latest tweaks would not be
enough to woo rebellious British lawmakers who have threatened
to vote down May's plan again on Tuesday evening.
"The markets are likely to continue trading with a somewhat
cautious bias as they await the outcome of the vote in the UK,"
Nedbank analysts said in a note.
"The rand has traded steadily firmer after the high print on
Friday as risk assets have found support. The next technical
support in the rand is towards the 14.2000 level," they added.
Dollar weakness after U.S. consumer prices showed that
inflation remains low despite a tight labour market, bolstering
the Federal Reserve's case for keeping interest rates on hold,
also helped the rand.
In fixed income, the yield on the benchmark bond due in 2026
added 1 basis point to 8.675 percent.
On the stock market, the Johannesburg All-Share index
rose 0.21 percent to 55,699 points, while the Top-40
index firmed 0.16 percent to 49,468 points.
"Our market is soaring higher today, along with the rest of
the globe," portfolio managers at Vestact said in a note.
Multi-national drugmaker Aspen led the gainers following a
sell-off on Friday, when the company lost almost a third of its
value on concerns about ballooning debt. It rose 10.28 percent
to 113.03 rand.
The financials index moved higher, boosted by solid
results from the country's oldest bank FirstRand, which
reported a 6.1 percent rise in half-year headline earnings,
outperforming rivals in retail banking.
FirstRand climbed 2.04 percent to 63.39 rand.
Builder Group Five applied for the suspension of
trading in its shares after it filed for bankruptcy protection
on Tuesday as lenders pulled funding, threatening the collapse
of one of the biggest names in the local construction industry
and more than 8,000 jobs.
(Reporting by Olivia Kumwenda-Mtambo and Nqobile Dludla.
Editing by Jane Merriman)
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