The rand was weaker on Thursday, while the JSE was little changed as investors kept a close eye on the US debt-ceiling talks.
The local currency weakened for the third consecutive session, touching an intraday worst level of R19.48/$ as the outlook for SA remains gloomy, with intensifying load-shedding in winter making headlines. The dollar, meanwhile, it at its strongest levels in seven weeks.
Eskom presented its power supply and demand plan for June, July and August during a media conference on Thursday, warning of the likelihood of stages 7 and 8 being on the cards as the weather gets colder and power demand increases.
Eskom chair Mpho Makwana said the power system was severely constrained, mainly due to poor maintenance of the Eskom coal fleet in the past.
“The broad R19.00/$-R19.50/$ range remains intact for now, but the is a distinct feeling of unease over the rand with news headlines being centred [on] intensifying load-shedding,” said TreasuryONE currency strategist Andre Cilliers.
“The G7 [Group of Seven] meeting kicks off today with SA not being invited, load-shedding continues unabated, and there is some concern over the S&P’s credit rating review tomorrow,” he said.
At 10.35am, the rand had lost 1.09% to R19.456/$, 0.93% to R21.0403/€ and 0.69% to R24.1902/£. The euro was 0.24% weaker at $1.0814.
Meanwhile, President Joe Biden on Wednesday expressed confidence that negotiators would reach an agreement to avoid a catastrophic default. Legislators and White House officials have expressed cautious optimism, reported Bloomberg.
“Optimism grew that the US may find a way to lift its debt ceiling and the Biden administration saying that a deal on raising the US debt ceiling might already happen this week, lifting sentiment in the stock market,” said Citadel Global director Bianca Botes.
At 10.35am, the JSE all share was little changed at 78,456.18 points and the top 40 had gained 0.1%. Industrial metals had gained 0.7% and industrials 0.29%. Precious metals had lost 1.13%, retailers 0.68%, banks 0.56%, financials 0.37% and resources 0.12%.
At the same time in Europe, France’s CAC 40 had gained 0.91% and Germany’s DAX 1.49%.
Earlier in Asia, the Shanghai Composite added 0.4%, Hong Kong’s Hang Seng 0.78% and Japan’s Nikkei 1.6%.
Gold lost 0.3% to $1,975.97/oz and platinum 0.66% to $1,064.90/oz. Brent crude was 0.31% weaker at $76.47 a barrel
With Denene Erasmus
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