Rand Gains Strength After DA Vote of No Confidence Fails
The rand continued gaining strength yesterday after the vote of no confidence against President Zuma failed.
By 1625 the rand had firmed 1.9 percent to 15.700 per dollar, moving further away from the psychologically crucial 16.00 mark it slumped to after reports of a rift between the president and the finance minister.
Bonds were weaker, with benchmark 2026 issue adding 1.5 basis points to 9.365 percent.
Data on Tuesday showed South Africa’s economy expanded only 0.6 percent in the final quarter, slowing as the agricultural and manufacturing sectors shrank, while new vehicle sales fell by 8.1 percent year-on-year.
FirstRand rose 5 percent to R46.50.
Shares in global mining firms Anglo American rose 3.7 percent to R107.84, while BHP Billiton advanced 2.47 percent to R162.42.
“A rising tide lifts all ships they say, so higher resources stocks leads to higher banking stocks,” said Redelinghuys.
“We saw the People’s Bank of China (POBC) ease monetary policy yesterday and I believe that resources at large and resources stocks in general are still feeling the positive effects of this subtle stimulus.”
