5 things you need to know before the JSE opens today
·4 Feb 2016
Here is what’s happening in the markets:
- South Africa needs needs to declare a national disaster to release relief funds to farmers to help them through the worst drought in over a century, according to Grain SA. A disaster has already been declared in five provinces as the 2016 harvest is expected to be 25% smaller than last year’s yield.
- The rand continued to weaken on Wednesday as sentiment towards risky assets stayed subdued. The currency dipped to R16.27 to the dollar; however, it made a late recovery, boosted by mining shared which led stocks higher. On Thursday morning, the rand opened at R15.98 to the US dollar, R23.39 to the pound and R17.71 to the Euro.
- The South African Chamber of Commerce and Industry (SACCI) is expected to releases its business confidence index today. The January index showed that South Africa opened the year with its lowest rate since 1993. with continued economic pressure, the February index is not expected to be much better.
- Ahead of the state of the nation address, business leaders have met with President Jacob Zuma to discuss how the country can avert a credit rating downgrade and further stress on the economy. 60 business leaders from various sectors met on the backdrop of extremely low economic growth prospects – between 0.8% and 0.9% – with a looming risk of recession.
- In global markets, Asian shares rallied on Thursday as speculation the US Federal Reserve might opt to not raise interest rates at all this year hammered the dollar and sparked a huge rally in oil prices.
In other news: Public Protector Thuli Madonsela has welcomed President Jacob Zuma’s willingness to engage on the Nkandla saga, and his offer to pay back some of the money as laid out in her report on the matter. However, politicians have been less kind, with the DA rejecting Zuma’s play, and continuing its bid to drag the president to the Constitutional Court.
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