South African Stocks Closed at Record High, Rand Gains 2%
Johannesburg Stock Exchange’s index rose about 0.7% to close at 82,824 on Friday, a record high, extending gains for the fourth session in a row.
Market sentiment continued to be bolstered by receding concerns over a potential recession in the US and prospects of global interest-rate cuts in coming months.
Investors are now focusing on the Jackson Hole Symposium and the Federal Reserve Chair’s speech next Friday, which may provide insights into the Federal Reserve’s upcoming actions.
On the corporate front, Vodacom topped the main index, soaring 5.6%, after the company pledged to spend ZAR 800 million this financial year to upgrade its network and deliver connectivity to deep remote locations in the South African region of KwaZulu-Natal.
South Africa’s rand was on course for gains of over 2% this week, while stocks hit a record high in intra-day trade on Friday, as upbeat U.S. economic data allayed fears of an imminent recession in the world’s top economy.
The rand traded at 17.8850 against the U.S. dollar, up about 0.65% on Thursday’s closing level. The dollar was last down about 0.39% against a basket of global currencies
The Johannesburg Stock Exchange’s Top-40 index hit a record high in intra-day trading on Friday. It closed over 0.7% up.
“Positive economic data out of the world’s largest economy this week has aided risk on sentiment of which South Africa is a beneficiary,” said Shaun Murison, senior market analyst at IG.
Like other risk-sensitive currencies, the rand often takes cues from global drivers such as U.S. economic data and monetary policy in addition to local data points.
Markets will likely focus on a speech from Fed Chair Jerome Powell at the Jackson Hole Symposium of global central bankers in Wyoming next week for further hints on the interest rate path of the U.S.
South Africa’s benchmark 2030 government bond (ZAR2030=) was weaker as the yield gained 9 basis points to 9.32%. #South African Stocks Closed at Record High, Rand Gains 2%
