Market News 19/09/2014
South African stocks ended higher, up 0.9%, on Thursday, led by Naspers while banks extended gains for the 3rd straight session. Naspers topped the gainers' list after UBS raised its rating to 'buy' from 'neutral'. In response, its shares climbed 4.8% to R1,340. Banks performed well with Nedbank picking up 1.7% to R229.49 and FirstRand adding 1.3% to R44.72. Participants were largely unfazed by the SARB’s decision to leave rates unchanged and a subsequent announcement that its governor would step down.
Gold held above its lowest in 8-1/2 months this morning, but was headed for a third straight weekly drop on fears that a rate hike in the US and a strengthening economy could dim the metal's appeal. Investors were also eyeing the results of Scotland's independence referendum to gauge the impact on the dollar, which was already trading near a four-year high against a basket of major currencies. Spot gold was little changed at $1,224.64/oz, after gaining 0.2% yesterday and is poised for a 0.3% drop for the week.
South Africa's rand weakened against the dollar on Thursday, falling to a 7-month low after respected Reserve Bank Governor Gill Marcus said she would not renew her contract when her five year term ends in November. Marucs also left the benchmark repo rate unchanged at 5.75% at the bank's penultimate policy meeting of the year, citing a weak growth outlook as the basis for her decision. The rand fell to 11.1095/dollar after Marcus's announcement, before clawing back to 11.0675, down 0.3% from its previous close.
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