Top CEO questions where taxes go, and China’s mysterious oil imports

The rand closed the week on the front foot as the dollar retreated amid fears of poor US financial health and rising Treasury intervention in the bond market. 

South Africa’s currency ended the week at R16.02 to the dollar, after some brief periods below the R16 mark. 

This strength has little to do with improving fundamentals in South Africa. The overwhelming force is the weakening of the US dollar. 

While bonds fell, stocks and equities surged in US trade late on Friday. The Dow Jones rose 1%, and the Nasdaq ended a five-day drop. 

Investor attention in the US has shifted towards Nvidia’s results on this coming Wednesday. It will give a strong indication of whether the AI-driven equity surge will continue. 

Much of the week was dominated by the fallout from a recent spike in bond yields, fueled by worries about inflation and spendthrift governments. 

They are now awaiting a promised new initiative from Treasury Secretary Scott Bessent aimed at fiscal consolidation.

Oil ended the week up as traders wait for a promised US economic package to isolate Iran’s economy, with no end in sight to the conflict. 

West Texas Intermediate settled just above $87 to notch a six-session run of gains. Global crude benchmark Brent closed higher as well, ending above $94 a barrel. 

Other commodities surged higher, including gold, platinum, and other precious metals, as investors search for safety amid renewed volatility. 

This boosted the JSE, with the All Share Index ending Friday up nearly 2% and the Top 40 Index ending up 2.2%. The JSE’s resources index surged 4.8%. 

Important finance and investing news

Bitcoin surges: Bitcoin rebounded sharply from weeks of low volatility and tight range-bound trading as institutional demand for the asset picked up. The cryptocurrency jumped more than 9% to hit a peak of $79,455 on Friday, its highest level since late May. [Wall Street Journal] 

Top South African CEO asks where tax money goes: DRDGold CEO Niël Pretorius says there are few signs of the tax bonanza delivered by high gold prices. Pretorius said a tiny portion of the money actually goes to communities where the metal is mined. [BusinessDay]

China weathers the storm: China has emerged from the oil price shock from the war in Iran largely unscathed, despite being the largest consumer of the commodity. Somehow, the world’s second-largest economy slashed imports to survive, limiting price increases around the world. [Wall Street Journal] 

Nigeria eyes mining jackpot: Nigeria is betting on a grant program to spur the discovery of new commercial mining and processing opportunities as part of a broader strategy to secure a larger share of African mining investment. [Semafor]

Durban heading for disaster: The eThekwini Metropolitan Municipality’s ageing wastewater infrastructure has been described as a ‘disaster waiting to happen’. The local government needs a capital injection of about R6 billion to fix it. [EWN]