THE rand sank as concerns of rising infections weighed on global sentiment, with the risk-off tone carrying through to the broader asset class.
At the close of local trade, the rand depreciated by 0.4 percent, ending the day at R14.50/$, after trading in range of R14.37/$ to R14.53/$. The rand traded flat overnight. The expected range of the dollar against the rand today is R14.40/$ to R14.70/$.
The JSE All Share declined (-2.6 percent) yesterday, all the major indices ended the day in the red with resources (-3.7 percent) stocks suffering the worst decline. Concerns over the swift global spread of the Delta variant has fanned investors’ fears, resulting in a weaker rand and a fall in the local bourse. In the overall emerging market sphere, Latin American stocks plunged by 3.2 percent, on track for its worst decline in five months, while the MSCI Emerging Market Index (-1.7 percent) traded lower.
The Brent oil price declined significantly yesterday, following the agreement reached by Opec+ last week after an earlier disagreement between Saudi Arabia and the UAE had heightened uncertainty. The cartel plans to raise production by 400 000 barrels per day each month from August to December, while the deal to gradually release supply has been extended to December 2022.
At the close of local trade, benchmark Brent crude futures declined by 5.1 percent, ending at $69.3pb. Crude prices regained some of its losses during Asian trade this morning.