South Africa’s rand, stocks rise as Trump trips up dollar
South Africa’s rand gained more than one percent on Tuesday, reversing much of the previous session’s losses as appetite for risk assets globally rose after comments by U.S. President Donald Trump put the skids under the dollar.
Stocks ticked up, led by gold and platinum shares benefiting from higher resource prices.
By 1550 GMT the rand was 0.65 percent firmer at 13.4025 per dollar, retreating after gaining more than one percent to a session high of 13.3500, as comments by Trump and a member of his administration raised bets the U.S. central bank could raise rates more slowly in 2017.
Trump, in a meeting with the chief executives of several top drugmakers on Tuesday, said drug companies had outsourced production because of currency devaluation by other countries.
At 1550 GMT the dollar index was down 0.88 percent to its weakest in nearly two months.
Locally, an acceleration in credit demand and a larger than expected trade surplus in December helped soothe sentiment after rumours of a possible cabinet reshuffle had hurt the currency.
On the bourse, the benchmark Top-40 index ticked up 0.17 percent to 45,929 points while the All-Share index rose 0.24 percent to 52,788.
Spot gold rose 1.63 percent and platinum gained 1.23 percent by 1528 GMT as United States travel restrictions unnerved markets and prompted investors to buy bullion as risk insurance.
“We have seen an overnight improvement in the platinum price and that has been reflected in the platinum shares. Its probably on the back of those metal prices, that is why we are a bit stronger today,” said Cratos Capital equity analyst Greg Davies.
Impala Platinum rose 2.63 percent to 53.44 rand, AngloGold Ashanti gained 1.91 percent to 169.89 rand and Northam Platinum climbed 3.38 percent to 51.15 rand.
Bonds also firmed, with the yield on the benchmark paper due in 2026 down 0.5 basis points to 8.825 percent.
