The Rand weakens significantly on load-shedding woes following stage 6 load-shedding, which was implemented over the weekend.
Coronation Asset Management has also reported increasing its stake in Pepkor to 5%.
In other news, the Chinese central bank has increased its cash injection into China’s economy and lowered its interest rate to stabilise the liquidity level.
Here is the biggest news of the day.
- The Rand weakens significantly on load-shedding woes. The move in the currency started on Tuesday, as higher than expected US inflation data cemented expectations of a more aggressive Fed, considerably strengthening the dollar. The release of the data coincided with an increase to stage 4 load-shedding after the loss of 3 units at the Kendal power station. Overall the Rand weakened from R17.10 / $ to R17.60 / $ by the time forex markets closed on Friday. Following the breakdown of several additional units, South Africans woke up to stage 6 load-shedding on Sunday. The Rand further weakened to R17.70 / $ in only a few hours during the relatively quiet trading period through Sunday night. Following an emergency board meeting on Saturday, Eskom is scrambling to procure an additional 1000 MW of power from existing independent power producers.
- Coronation Asset Management has increased its stake in Pepkor to 5%.
- Chrometco to offer shares in its Black Chrome Mine as part of its business rescue proceedings. Chrometco will commence a structured bid process whereby prospective investors will be invited to potentially acquire all or some of the shares in Black Chrome Mine.
- Chinese central bank lowered the 14-day interest rate and stepped up cash injections. The People’s Bank of China (PBOC) dropped the borrowing cost of 14-day reverse repos from 2.25% to 2.15%. The central bank also injected 2 billion yuan through 7-day reverse repos and another 10 billion yuan through 14-day reverse repos. The central bank said the move aims to “maintain liquidity level stable at the end of the quarter”. The move follows the 7-day reverse repo rate reduction in August to revive credit demand and prop up their slowing economy.