Investors jittery, rand retreats as Mangaung looms

Markets in South Africa will be closed for a national holiday on Monday. Trading will resume on Tuesday.

The ruling ANC party starts a 5-day leadership election meeting on Sunday, which will likely see President Jacob Zuma re-elected for a second term.

The ANC will also hammer out a final stance on issues such as mines nationalisation or taxation, and labour policy. Mining companies are concerned that the ANC may decide to increase taxes on mines, further increasing their costs.

"Nationalisation seems to have been ruled out but remains a concern, while SAGBs (South African government bonds) have already taken on a cautious stance with prospects for raising mining taxes, which would help the government but ultimately impact industry," said Anisha Arora, emerging market analyst for 4Cast.

A re-election of President Zuma is expected to keep intact what are seen as some of the world's most rigid labour laws, which some have argued have helped keep 25% of the labour force without work.

The rand was stuck in a recent range on Friday and moved away from key resistance at 8.60 as the barrier proved too tough for rand bulls while there was uncertainty in the domestic market.

"Until progress is made we expect the rand will continue to range trade," 4Cast's Arora said.

Bonds weakened to one-week lows and yields ended at 5.425% on the 2015 note and 7.345% on the 2026 issue on what dealers said was profit-taking after a month-long rally, especially on the longer end.

"This week we continued to see good demand for duration from offshore accounts. Today guys are taking some profit because some of the very long end bonds, the R209s and R214s, have been struggling to break some key technical levels," said a local bond trader.

The 2041 yield has bounced from around 8.12% since Tuesday, while the 2036 hit resistance at around 8.09%. – Reuters.

Reuters
Guest Author
Advertisting

Workers fight job-creation ‘mess’

Former Ekurhuleni workers argued in court that a programme promising to equip them with skills simply acted as a labour broker for the municipality

Court dissolves local municipality

Landmark judgment paves the way for South Africans to use legal system to hold councils responsible

Mabuza’s ‘distant relative’ scored big

Eskom’s woes are often because of boiler problems at its power plants. R50-billion has been set aside to fix them, but some of the contracts are going to questionable entities

ANC faction gunning for Gordhan

The ambush will take place at an NEC meeting about Eskom. But the real target is Cyril Ramaphosa
Advertising

Press Releases

New-style star accretion bursts dazzle astronomers

Associate Professor James O Chibueze and Dr SP van den Heever are part of an international team of astronomers studying the G358-MM1 high-mass protostar.

2020 risk outlook: Use GRC to build resilience

GRC activities can be used profitably to develop an integrated risk picture and response, says ContinuitySA.

MTN voted best mobile network

An independent report found MTN to be the best mobile network in SA in the fourth quarter of 2019.

Is your tertiary institution is accredited?

Rosebank College is an educational brand of The Independent Institute of Education, which is registered with the Department of Higher Education and Training.

Is your tertiary institution accredited?

Rosebank College is an educational brand of The Independent Institute of Education, which is registered with the Department of Higher Education and Training.

VUT chancellor, Dr Xolani Mkhwanazi, dies

The university conferred the degree of Doctor of Science Honoris Causa on Dr Xolani Mkhwanazi for his outstanding leadership contributions to maths and science education development.

Innovate4AMR now in second year

SA's Team pill-Alert aims to tackle antimicrobial resistance by implementing their strategic intervention that ensures patients comply with treatment.

Medical students present solution in Geneva

Kapil Narain and Mohamed Hoosen Suleman were selected to present their strategic intervention to tackle antimicrobial resistance to an international panel of experts.