5 things you need to know before trading opens today
·10 Mar 2016
Here is what’s happening in the markets:
- Ratings agency Moody’s has put South Africa’s Baa2 rating under review – the group will be in the country to assess the situation, and make a decision by the end of March. If the group cuts South Africa’s rating to Baa3, all three ratings agencies will have the country lingering above junk status.
- While Finance Minister Pravin Gordhan has received positive response on his roadshow to boost investor confidence in South Africa, investors still remain wary. Investors are confident in the minister, but remain skeptical amid South Africa’s mounting economic woes.
- South Africa’s rand climbed nearly 2% against the dollar on Wednesday as U.S. wholesale data pointed to restrained growth in the world’s biggest economy boosting appetite for emerging market currencies. Stocks slipped, however. On Thursday, the rand was trading at R15.22 to the dollar, R21.62 to the pound and R16.71 to the euro.
- In global markets, Asian stocks edged up on Thursday, encouraged by a rally in crude oil prices and expectations that the European Central Bank will ease policy later in the day, emulating policymakers elsewhere seeking to bolster their struggling economies.
- Oil prices dipped early on Thursday after U.S. crude hit 2016 highs the day before and Brent shot back over $40 per barrel, with analysts warning that larger gains would be unwarranted as a global glut continues to outweigh strong demand. In South Africa energy, Eskom said it will increase its capital expenditure by 44% to R324 billion rand ($21 billion) over the next five years to build new power stations.
In other news: Former president Thabo Mbeki has met a fresh wave of criticism for defending his stance on HIV/AIDS – where he is often quoted as saying “HIV does not cause AIDS”. Now two HIV/AIDS researchers have added their support to his views, saying the country was sold a story by America.
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