Sunday, January 16, 2022
Home Business Rand, stocks recover after sinking on Omicron worries

Rand, stocks recover after sinking on Omicron worries

In early trade the rand was at R16.12 against the dollar, 1% firmer than its close on Friday, when it sank to R16.36.

The rand firmed early on Monday, recovering from last week’s plunge to its lowest since October 2020 on concerns around the discovery of a Covid-19 variant in the country that has been described as the most concerning.

Stock markets also recovered, after hospitality shares fell sharply on the news a host of countries would bar travel from southern Africa, hitting hopes of a bumper season for a tourism industry hurt badly by the pandemic.

At 0830 GMT, the rand traded at R16.12 against the dollar, 1% firmer than its close on Friday, when it sank to R16.36.

Global authorities reacted with alarm on Friday to the new variant, Omicron, which was detected in South Africa, with the EU and Britain among those tightening border controls as scientists sought to find out if the mutation was vaccine-resistant.

With little still known about the new coronavirus strain, market participants remained cautious.

“While the initial knee-jerk of the variant seems to be over, we still see some vulnerability in the EM market, with the stronger dollar posing a risk,” Andre Cilliers, currency strategist at TreasuryONE, said in a note.

“It will also be a boon to the local market as the President (Cyril Ramaphosa) did not announce any new lockdown measures in his address last night,” he said.

Opting not to impose further coronavirus curbs, Ramaphosa said on Sunday that authorities were considering making Covid-19 shots compulsory for certain places and activities, as a rise in infections linked to a new variant threatened to become a fourth wave.

The Johannesburg Stock Exchange’s All-Share Index was over 1% higher, with investors welcoming the news that domestic tourism remained unaffected for now. The blue-chip Top-40 was also up 1%.

Hoteliers City Lodge, Sun International, which also owns the country’s biggest casino chain, and Tsogo Sun Hotels were up over 5%, 3.6% and 2.41% respectively after crashing on Friday.

Government bonds also recovered, with the yield on the benchmark 2030 maturity down 5.5 basis points to 9.845%. The yield hit 10% on Friday, its highest since early May 2020.



It was hell working under Dudu Myeni: SAA CEO

Forrmer SAA acting CEO Mathulwane Mpshe

Africa’s first floating gas plant arrives in Mozambique

Africa’s first deep-sea floating Liquified Natural Gas (LNG) facility has arrived in Mozambican seas after a seven-week journey, marking a crucial milestone...

David vs David in fight over millions

It’s a battle of two prominent namesakes – soccer boss David Thidiela and his childhood friend David Mureri,...


Please enter your comment!
Please enter your name here

Most Popular

International blesser, Serge Cabonge in trouble with the law

Self-proclaimed “international blesser” Serge Cabonge is at loggerheads with the law after he was arrested on Monday for alleged reckless and negligent...

ANC MP wants Ramaphosa hauled before Scopa over ‘misuse’ of state cash

Leaked recording alluding to state funds being used for party campaigns has MP demanding explanation from president An...

Idols SA: Somizi in, Unathi out?

Media personality Unathi Nkayi is unlikely to be part of the upcoming season of popular singing competition Idols SA. 

ANC at the centre of SABC infighting

The ongoing battle between the SABC hierarchy and its news editor in chief, Phathiswa Magopeni, has caused a storm in the public...

Recent Comments

WP2Social Auto Publish Powered By :