The rand steadied against the dollar on Wednesday but was seen under pressure along with local shares partly due to frail sentiment in global markets.
International stocks fell as Lehman Brothers’s financial woes re-ignited worries about the financial sector.
The blue chip Top-40 September futures contract was up 0,9% ahead of market opening but analysts saw local stocks in the red.
”In general I think there is still a lot of negative sentiment from overseas,” said Fanie Joubert, economist at Efficient Group.
”Resource driven Australia is down [sharply] … and with commodities down, we expect resource stocks to be under pressure.”
The rand was trading at 8,0020 against the dollar at 6.50am GMT, not far off its last close of 8,0225.
It was last around 11,29 to the euro after touching a near seven-month high of 11,0507 on Tuesday.
Dealers said weaker commodities and global stocks will likely weigh on the currency.
”I’m expecting a volatile day, commodities are lower and stocks are under pressure. That is going to be negative for the rand. We are expecting it to top out at 8,05/07,” said Jim Bryson, chief dealer at RMB.
Gold hit $762,55 an ounce earlier, its lowest level since late October 2007, but later bounced to around $773. It has dropped more than 20% since hitting a four-month high of $987,75 an ounce in mid-July.
Government bonds were weaker with yields on the 2015 issue up 5,5 basis points to 9,205 percent and that on the 2036 bond up six basis points to 8,57%. – Reuters