MARKET WRAP: Rand firms as investors ponder Brexit deal

The rand was firmer against the pound on Thursday evening, as markets digest news that the EU and Britain have reached a deal on the latter’s exit from the EU.

At a meeting on Thursday, the EU and Britain agreed on a Brexit deal, three years after the UK voted to leave the regional bloc. The deal still needs to be approved by both the UK and EU parliaments. Northern Ireland’s Democratic Unionist Party (DUP) said earlier on Thursday that it would not support the Brexit plan. 

“Anyone hoping that the process will be straightforward now is kidding themselves,” senior market analyst at Oanda Craig Erlam said. “With the Labour Party whipping for a second referendum on the deal and the Liberal Democrats unlikely to support anything, there is still a good chance we’re heading for an extension and election = to get this over the line. Nothing in Brexit is ever simple.”

At 5.23pm, the rand had firmed 0.79% to R19.021/£, shedding some gains after earlier reaching R18.9518. It had strengthened 1.02% to R14.7915/$ and 0.6% to R16.4459/€.  The euro was up 0.42% to $1.1119.

Gold gained 0.19% to $1,492.3/oz while platinum was down 0.11% to $885.02. Brent crude lost 0.1% to $59.05 a barrel.

The Dow was up 0.12% at 27,035.49 points. In Europe, the FTSE added 0.52%, while Germany’s DAX 30 was flat and France’s CAC 40 lost 0.19%.

The benchmark R186 government bond was stronger, with the yield falling three basis points to 8.245%. Bond prices move inversely to bond yields.

Earlier, the Shanghai Composite and Japan’s Nikkei 225 were little changed while Hong Kong’s Hang Seng rose 0.69%

Markets are still awaiting some direction regarding the US-China trade talks. US treasury secretary Steven Mnuchin said officials from the two countries are working on the text of a phase one deal to be signed by presidents of both countries in November, Reuters reported.

The JSE all share fell 0.17% to 55,993.40 points and the top 40 0.28%. Resources lost 1.22% while platinum miners gained 2.17%

BHP dropped 2.01% to R305.93 after the diversified miner said on Thursday that it will reach a final decision on its $17bn Jansen potash project in Canada in early 2021.

Spear climbed 4.65% to R9 after the landlord said on Thursday that its headline earnings per share (HEPS) grew 2.75% to 45.47c in the six months to end-August.

Growthpoint fell 0.83% to R22.66. The property group said on Thursday that it would offer Capital & Regional shareholders a premium of about 100% for their shares as it plans to acquire about 30.3% of that company.

Datatec gained 1.6% to R32.30 after it said on Thursday that its HEPS increased to 2.3 US cents in the six months to end-August, from 0.7 US cents in the comparable period.

- BusinessLIVE