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Rand firms on improved risk appetite, stocks down

Stocks down, led by Lonmin.

JOHANNESBURG – The rand strengthened on Monday, firming with fellow emerging market currencies as risk demand recovered globally and data suggested an improving local economic outlook.

Stocks fell, led by Lonmin, which came under pressure after its chief operating officer (COO) resigned.

At 1500 GMT, the rand had gained 0.33 percent to 12.9775 per dollar, dipping below the psychological important 13.00 mark for the first time in three sessions.

The dollar was slightly weaker on the day as investors took profits following its rally last week when bets hardened the Federal Reserve would hike rates later in March.

Demand for emerging market currencies was also helped by waning fears over the Chinese economy after officials cut their 2017 growth expectations slightly but said they would implement reforms to address a possible debt crisis.

South African data showing an improved manufacturing outlook and higher maize yields has eased pressure on the rand, with economic growth data due on Tuesday expected to support signs of a gentle recovery.

In fixed income markets, bonds were firmer, with the yield on the benchmark paper due in 2026 falling 4 basis points to 8.685 percent.

On the bourse, the benchmark Top-40 index dropped 0.47 percent to 44,425 points while the All-Share index fell 0.41 percent to 51,498 points.

Lonmin fell 8.50 percent to 16.14 rand after the troubled platinum miner said COO and director Ben Moolman would step down on April 5 for personal reasons.

“One of your top operations guys is leaving, it doesn’t bode very well for the company,” said BP Bernstein trader Vasili Tirasis.

Among the biggest fallers on the JSE blue chip Top-40 index was MTN, which tumbled 2.89 percent to 120.68 rand. Anglo American dropped 3.21 percent to 196.84 rand and Impala Platinum fell 1.77 percent to 41.60 rand.

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