#RandReport: Rand slips, stocks dragged lower by MTN
The rand slipped to its weakest in nearly a month on Tuesday as diminishing risk sentiment.
JOHANNESBURG - The rand slipped to its weakest in nearly a month on Tuesday as diminishing risk sentiment ahead of a US central bank meeting weighed on emerging market currencies.
Stocks also suffered as mobile operator MTN extended losses from Monday when the company confirmed that the Nigerian communications regulator had fined it $5,2 billion for failing to deregister SIM cards in Nigeria.
By 1530 GMT, the rand had weakened 0,25 percent to 13,6800, regaining some ground after dipping as low as 13,7750 as data showing unemployment rising added to an already grim growth picture for Africa's most industrialised economy.
Government bonds also weakened, with the benchmark paper due in 2026 adding 3 basis points to 8,38 percent.
The unemployment rate rose to 25,5 percent in the third quarter, official data showed, adding to the dim economic prospects painted in last week's national budget and ongoing student protests.
"The high rate of unemployment contributes to much of the social tension and anguish experienced in South Africa on a daily basis, especially among the youth," said Stanlib's Chief Economist Kevin Lings.
Although the US Federal reserve is not expected to move rates when its two day policy meeting concludes on Wednesday, traders said bets on riskier emerging markets to remain muted.
On the bourse, South Africa's blue-chip Top 40 index shed 0,7 percent to 48,231 points while the All-share index was down 0,7 percent at 53,770 points.
MTN was a big loser after it was fined in Nigeria, its biggest market, contributing around a third of the group's revenue. MTN's shares fell 4 percent to 160 rand.
"MTN is still suffering from the news about the fine and the market wants to see more reaction from the company about what they are going to do," said Afrifocus Securities trader Ferdi Heyneke.
MTN said on Monday it was in discussions to resolve the matter without elaborating.
Anglo American was the worst performer among the blue chips, pulled down by its Kumba Iron Ore unit, which Heyneke said is still facing headwinds from an economic slowdown in China, a big consumer of the commodity.
Anglo shares were down 5,6 percent at 117,08 rand, while Kumba tumbled 10,85 percent to 65,50 rand, reaching a new low of 65,03 rand in intraday trading.
Trade as robust with more than 208 million shares changing hands, well above last year's daily average of 183 million shares.