Rand weakens on cautious trading, stocks down



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At 1523 GMT, the rand was 0.62% weaker at $ 13.7 a dollar as it struggled to keep recent gains below the technical resistance mark of 13.60.

Image: EWN.

JOHANNESBURG – The Rand weakened against the dollar on Monday, ahead of a full week of market-shaking events.

At 1523 GMT, the rand was 0.62% weaker at $ 13.7 a dollar as it struggled to keep recent gains below the technical resistance mark of 13.60.

"There are a lot of risky events next week so the market is a bit cautious," said Jana van Deventer, an analyst at ETM Analytics. "We have the Fed meeting on Wednesday night and we also have US-China trade talks that are taking place on Wednesday and Thursday.

US policymakers are expected to signal a pause on Wednesday in interest rate hikes and recognize rising risks to the US economy. That will probably weigh on the dollar.

Investors are also awaiting Chinese Vice Premier Liu He's visit to Washington on January 30 and 31 for the next round of trade talks with the United States.

Government bonds weakened, with benchmark yields past due in 2026, adding 4.5 basis points to 8.765%.

Stocks fell, with the top-40 index of the Johannesburg Stock Exchange falling 0.61% to 47,600 points, and the broadest index of all stocks falling 0.52% to 53,767 points.

Big banks and retailers topped the blue-chip index, with Shoprite, FirstRand, Truworths, Absa and Standard Bank, all at the bottom.

Banks and retailers are all sensitive to the health of consumer finance, following a series of negative trade updates from retailers last week.

Retail and furniture retailer Pepkor, formerly Steinhoff Africa Retail, fell 4.2% after a trading update that showed quarterly revenue rose 6.1% in the three months ended December.

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