World Markets

South Africa's rand firms despite risk-off mood, equities fall

Credit: REUTERS/Mike Hutchings

South Africa's rand firmed on Thursday, bucking a risk-off trend in global markets, but equities were pulled lower on weak Chinese data and doubts about whether Beijing and Washington will reach a trade deal anytime soon.

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JOHANNESBURG, Nov 14 (Reuters) - South Africa's rand firmed on Thursday, bucking a risk-off trend in global markets, but equities were pulled lower on weak Chinese data and doubts about whether Beijing and Washington will reach a trade deal anytime soon.

At 1525 GMT, the rand ZAR=D3 was 0.85% firmer at 14.7860 per dollar.

"Although investor appetite towards riskier assets continues to be strained by fading trade optimism and global growth concerns, this is not being reflected in the rand today," Lukman Otunuga, senior research analyst at FXTM said in a note.

"Given how the local currency remains buoyed....further upside could be on the cards in the near term," he added.

Global risk sentiment cooled after industrial production growth in China slowed more sharply than expected in October, while retail sales fell short of prediction and investment growth hit a record low.EMRG/FRX

Doubts about whether the United States and China will be able to reach a preliminary trade deal once again resurfaced after the Wall Street Journal reported Beijing rebuffed a farm purchase deal that looked one-sided in favour of the United States.

"The rand's medium to longer-term outlook is poised to be influenced by not only domestic data but external drivers in the form of the Dollar's valuation, U.S. rate cut expectations and most importantly trade developments," Otunuga said.

The Top-40 .JTOPI share index fell 0.21% percent while the broader all-share .JALSH edged 0.27% lower.

Among the biggest decliners on the blue-chip index were Anglo American Platinum (Amplats) AMSJ.J, which fell 2%, and telecoms major MTN Group Ltd MTNJ.J, which dropped 1.85%.

The yield on the benchmark 2026 government bond ZAR186= was down 2.7 basis points at 8.43%.

(Reporting by Olivia Kumwenda-Mtambo; Editing by Kirsten Donovan)

((Olivia.Kumwenda@thomsonreuters.com; +27 11 595 2817; Reuters Messaging: olivia.kumwenda.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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