Business

5 things you need to know before trading opens today

Staff Writer

 ·16 May 2016

Here’s what is happening in the markets:

• All sectors are chiming in on media reports over the weekend that Finance Minister Pravin Gordhan was facing “imminent arrest”. Opposition party, the DA said that such a move would be worse than 9/12 – when former finmin Nhlanhla Nene was sacked, sending the South African economy into a tailspin. Law enforcement agencies have denied that such an action is going to take place.

• Another group has entered the fray to buy Absa bank, with Bloomberg reporting that investment group, Abraaj Capital is looking to grab a 35% stake of the company, valued at $2.3 billion. There is reportedly “no shortage” of bidders for a stake in Absa (Barclays Africa), though the main contender is said to be former Barclays CEO Bob Diamond, who is looking for the entire remaining stake of the group.

• South Africa’s rand fell nearly 2 percent against the dollar on Friday, weighed down by a pessimistic outlook for the economy and also reflecting the greenback’s broad-based gains as investors bet on higher US interest rates this year. On Monday the rand was trading at R15.52 to the dollar, R22.26 to the pound and R17.55 to the euro.

• In global news, buoyant Japanese stocks led Asian stocks to modest gains on Monday, helping to offset some of the gloom from soft Chinese data, while the dollar firmed against the euro and yen after receiving a boost from upbeat US indicators.

• Oil prices jumped over 1 percent on Monday after long-time bear Goldman Sachs said the market had ended almost two years of oversupply following global oil disruptions and flipped to a deficit. Brent crude futures were trading at $48.50 per barrel, up 67 cents, while US crude futures were up 68 cents at $46.89 a barrel.

In other news: The ANC in Gauteng has done an about-turn and has now said it accepts President Jacob Zuma’s apology for violating the Constitution of the country. Previously, the province stood out as one of the only groups to openly criticise the president following the matter.