Rand slips on hawkish Fed; stocks slip

South?Africa’s rand weakened on Friday in step with emerging market currencies as indications the nation central bank would stay with an insurance policy tightening path drained the need for risk to come U.S election results.

Stocks fell largely resulting from subdued risk demand globally and weak consumer demand locally.

At 1512 GMT the rand had slipped 1.06% to R14.2850 per dollar, having hit a session-low of R14.3475 as investors digested the Federal Reserve’s Thursday statement and bought dollars cheap, booking profits from earlier from the week.

“The rand and its emerging market peers struggled today and lost the fight gains for any week as momentum is favour of your dollar following Fed meeting,” said ETM economist Halen Bothma.

“Fresh tail wind supported the dollar following your hawkish Fed affirmed not wearing running shoes might be continuing with policy stabilisation.”

The Federal Reserve held mortgage rates steady but struck an expectedly hawkish tone that fed into some dollar gains and place emerging market currencies being forced.

The rand had rallied to R13.8700 on Wednesday following the U.S midterm elections, penetrating the R14.00 long run resistance level somebody in charge of by two months, lifted by way of a return of worldwide risk appetite.

Bonds were also weaker while using the yield over the benchmark paper due in 2026 adding 7.5 basis suggests 9.22% well before dealer where Treasury will place R10.655 billion in short-term bills.

On the bourse the Top-40 index fell 1.56% to 46,897 points, even though the broader the All-share index slipped 1.42% to 53,295 points.

“(It’s) an international selloff today no one have been exempt but we have now appear earlier lows,” said Ryan Woods, trader at Independent Securities.

Bourse heavyweight Naspers fell 1.83% to R2,745. Shares in Technology giant Tencent Holdings Ltd , whereby Naspers features a 31% stake, also fell. Tencent is reportedly cutting the marketing provide its key gaming division.

Shares in sugar producer Tongaat dove around 12% and closed 6 percent weaker at R61.30 after reporting so it had swung into a half-year loss and cited unfavourable market conditions included in the?South?African and Mozambique sugar operations.

Gold Fields shares were 2.56% lower following company reported a 3% stop by third-quarter production, dragged down by way of decline in output from its last?South African asset,?South?Deep.?