/ 6 March 1998

S&P rating hits bonds

FRIDAY, 6.00PM:

SHARES on the Johannesburg Stock Exchange staged a late rally after a dull day on Friday, much to the consternation of dealers who were at a loss to explain the recovery.

The all gold index slipped 2,1 points to 742,7. The industrial index rose 69,9 points to 8187,2, and the financial index, 103,3 points to 12639,1. The all share index ticked up another 64,3 points to end on 6926,1.

During the session, 99447-million shares worth R953,66m changed hands.

Dealers said the proposed deal between Anglo American and RMB Holdings was expected and the suspension of dealing in Rand Merchant Bank and First National Bank shares came as no surprise.

Though the market ignored Standard & Poor’s downgrading of South Africa’s sovereign rating from positive to stable, bonds reacted badly. At 4.30pm the R150, was at a 13,245% yield, down from its previous close of 13,10%. The R153 was 15 basis points weaker at a 13,46% yield.

The currency markets also sagged at the news of Standard & Poor’s move, and the rand fell to R4,9794 per dollar from Thursday’s R4,9455-85.

Gold was last quoted at $295,05 from a London morning fix of $294,25/oz.