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Markets WRAP: Rand closes at R13.99/$

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22 Feb 2019

The rand closed at R13.99 to the greenback on Friday afternoon. The day's range was between R13.95 and R14.05.

Earlier, TreasuryONE said that the rand was waiting to take direction from either the rating agencies or the dollar.

22 Feb 2019

Markets seem to have regained some faith in the strained economy, and many now anticipate that South Africa will be able to avoid a further downgrade by the two major ratings agencies, says Peregrine Treasury Solutions's Bianca Botes.

"The agencies will pay close attention to the restructuring of Eskom, the plans for dealing with other troubled State-Owned Enterprises (SOEs) and will also take into account some of the other positives to emerge such as a reduction in inflation and the steps being taken to decrease the bloated government wage bill." she said.

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22 Feb 2019

Cell C announced on Friday that its CEO, Jose Dos Santos, would step down on March 1, 2019.

"Dos Santos will take up a role as a consultant offering strategic advice to the chairman of the Cell C Board," the mobile company said in a statement on Friday. 

"In this role, he will be involved in the delivery of Cell C’s strategic intent, which includes the reshaping of Cell C’s debt to ensure the company’s continued sustainability."

The group's chair Kuben Pillay thanked Dos Santos for his "tireless work over the past six years, of which five of those have been at the helm of this company".

Cell C said an interim CEO would be announced shortly. 

22 Feb 2019

Stocks edge higher in Europe 

Bloomberg 

Stocks edged higher in Europe along with US equity futures on Friday after a mixed session in Asia as investors awaited results from top-level trade talks between America and China.

Treasuries posted a modest advance. The Europe Stoxx 600 Index erased a decline, with mining shares climbing as Bloomberg’s industrial-metals subindex rose to its highest since October.

Chinese stocks added to their rally, while Japanese shares slipped. The euro nudged higher before a speech on Friday by European Central Bank President Mario Draghi. The dollar was flat, while West Texas oil traded above $57 a barrel in New York.

Markets are cautiously optimistic as US President Donald Trump is set to meet with China’s top trade negotiator in Washington Friday, with the two sides facing a March 1 deadline to avoid a further escalation in tariffs - unless they extend the period for talks.

The mostly lackluster moves in equities on Friday come after an MSCI global gauge of stocks surged 15% in less than two months on wagers for an accord between the world’s economic superpowers and a less-hawkish stance from some of the biggest central banks.

Emerging-market stocks climbed for a fifth day, the longest streak since May, and a gauge of smaller Chinese stocks entered a bull market after advancing about 21% since October.

Despite increasing confidence a deal can be done, investors shouldn’t expect the stellar run for risk assets to continue at this pace, said Richard Turnill, global chief investment strategist at BlackRock.

“Don’t chase the rally,” Turnill told Bloomberg TV. “Don’t extrapolate the double-digit gains we’ve seen in the first six weeks of this year.”

Elsewhere, the pound fluctuated as the European Union’s chief Brexit negotiator said he doesn’t rule-out a delay to the date Britain leaves the bloc.

And these are the main moves in markets:

Stocks

The Stoxx Europe 600 Index increased 0.1% as of 09:03 London time. S&P 500 futures added 0.3%. The Shanghai Composite Index rose 1.9%. The MSCI Asia Pacific Index rose 0.2%. The MSCI Emerging Market Index rose 0.4%.

Currencies

The Bloomberg Dollar Spot Index rose less than 0.05%. The euro rose 0.1%. The British pound declined 0.1%, the largest fall in more than a week. The MSCI Emerging Markets Currency Index declined 0.1% to 1,643.76.

Bonds

The yield on 10-year Treasuries dipped one basis point to 2.68%. Germany’s 10-year yield fell two basis points to 0.11%, the biggest fall in more than a week. Britain’s 10-year yield fell two basis points to 1.177 %, the first retreat in more than a week.

Commodities

The Bloomberg Commodity Index rose 0.3%. Iron ore rose 0.8% to $84.77 per metric ton. West Texas Intermediate crude rose 0.3% to $57.14 a barrel. - Bloomberg

22 Feb 2019

New CEO for Wescoal

JSE-listed mining company Wescoal Holdings announced on Friday that mining and resources specialist Reginald Lavhelesani Demana has been appointed its Group CEO with effect from April 1 2019.

"Demana has over 20 years’ working experience, with the latter 14 years at the forefront of investment banking at Nedbank Limited, focussing on mining advisory. During this time, he has played a leading role in numerous major transformational transactions in the sector," said Wescoal in a notice to shareholders. 

Zukie Siyotula and Dr Martin van Wijngaarden have also been appointed as independent non-executive directors with effect from 14 February 2019. 

Read the announcement here

22 Feb 2019

The rand was trading at R13.96 to the greenback on Friday morning after starting the day at R14.02.

"The rand touched 13.8700 before weakening back to 14.0400 levels in New York.

"This morning we are at 14.0250 as markets await fresh direction from either the dollar or possibly the ratings agencies as they continue to analyse the budget.

"The dollar is a touch firmer this morning at 1.1337 against the euro and 1.3029 against the pound on the back of higher US Treasury yields and positive trade talk news.

"Poor Capital Goods orders and weak home sales numbers had little impact. Wall Street closed lower across all three indices and Asian stocks are mixed this morning. Gold was a big loser yesterday and has slipped to $1 325.20 this morning."          

22 Feb 2019

EOH CEO in fight to save graft-tainted IT company

EOH Holdings Chief Executive Officer Stephen Van Coller is in a race against the clock to restructure the sprawling South African IT business before shareholders and lenders run out of patience.

Van Coller, a former executive at the Barclays Africa Group and MTN, was brought in to turn around the troubled business and improve its corporate reputation after allegations of corruption linked to government contracts.

He plans to break Johannesburg-based EOH into different parts to release greater value from a portfolio of more than 270 companies, while appointing PwC as an internal auditor and launching a whistle blower app. - Bloomberg

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22 Feb 2019

Asia stocks drop on growth concerns

Asian stocks posted modest losses Friday following a weak US session as investors mulled an uncertain economic backdrop and mixed signals on trade negotiations.

Treasury yields pared Thursday’s gains.

Shares from Tokyo to Hong Kong edged lower after weaker than expected data on US durable goods orders and home sales reignited worries about global growth.

The dollar ticked higher amid reports signaling uneven progress in U.S.-China trade talks as next week’s deadline for more tariffs nears.

The kiwi fell after New Zealand’s central bank said proposals to lift bank capital requirements may force it to cut interest rates.

The weakness in equities comes after the MSCI’s global gauge of stocks surged 15% in less than two months on optimism over a US-China trade agreement and a less hawkish stance from some of the world’s major central banks.

President Donald Trump plans to meet with China’s top trade negotiator Friday afternoon as the US tries to forge a preliminary deal with its biggest economic rival, two people familiar with the matter said.

Despite increasing confidence a deal can be done, investors shouldn’t expect the stellar run for risk assets to continue at this pace, said Richard Turnill, global chief investment strategist at BlackRock. “Don’t chase the rally,” Turnill told Bloomberg TV. “Don’t extrapolate the double-digit gains we’ve seen in the first six weeks of this year.”

Also in focus on Friday is a speech from European Central Bank President Mario Draghi. Elsewhere, West Texas oil fell below $57 a barrel after an industry report showed American crude stockpiles continue to swell. The Aussie pared some losses after the nation’s Treasurer and trade minister said China had not banned coal imports to one of its ports. - Bloomberg

ZAR/USD
17.00
(-0.09)
ZAR/GBP
21.24
(-0.12)
ZAR/EUR
19.14
(-0.13)
ZAR/AUD
11.81
(-0.13)
ZAR/JPY
0.16
(-0.20)
Gold
1774.74
(+0.03)
Silver
18.05
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Platinum
808.00
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Brent Crude
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Palladium
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54521.90
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Top 40
50179.89
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Financial 15
10150.02
(-0.64)
Industrial 25
76554.73
(+0.52)
Resource 10
50138.02
(-1.24)
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