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Nedbank rumour keeps rand firm

Jul 26 2010 12:06

Company Data

Oldmutual [JSE : OML]

Last traded R18.75
Change R0.01
% Change 0.05%
Cumulative volume 5.42m
Market cap R91.33bn

Last Updated: 28/05/2012 at 17:43. Prices are delayed by 15 minutes. Source: McGregor BFA

 

Nedbank [JSE : NED]

Last traded R167.57
Change R-0.77
% Change -0.46%
Cumulative volume 149,153
Market cap R85.04bn

Last Updated: 28/05/2012 at 17:43. Prices are delayed by 15 minutes. Source: McGregor BFA

 

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Johannesburg - The rand continued its firm footing in midday trade on Monday on the back of rumours out of the UK, that HSBC and Standard Chartered were in talks to take over South African bank, Nedbank Group [JSE:NED].

The Financial Times of London reported that two British banks were in talks with Old Mutual [JSE:OML] regarding its 52% stake in Nedbank. It follows a similar rumour in May, reported by Sky News.

At 11:49 local time the rand was bid at R7.3786 to the dollar from R7.4111 at Friday's close. It was bid at R9.5405 to the euro from R9.5646 before and at R11.4400 against the sterling from R11.4402 at its previous close.

The euro was bid at $1.2901 from $1.2886 overnight.

A local dealer said: "The rand's strength is on the back of the Nedbank rumour. The local currency is well bid at R7.33-34 against the dollar, until we get any further news on Nedbank."

RMB analysts said in a morning report that the initial reaction to the EU bank stress tests released late on Friday was relief - US markets pushed up quite strongly and EUR/USD rallied, as only seven of the 91 banks failed.

"But subsequent criticism has been rife with many saying the tests lacked credibility given that the worst case assumptions weren't severe enough. One wonders if this really matters. Stressed banks should now have access to EU emergency funds and with detailed exposure to PIGS debt specified for all (except some German banks) the market can now do their own stress tests," they
said.

They added that the environment was rand friendly.

Dow Jones Newswires reported that euro is a little lower on Monday as European bank stress test results, released late on Friday, failed to widen sovereign debt yield spreads despite concerns that the tests weren't credible.

Instead, the results, which showed only seven of 91 banks in the region failing the test, appeared to have kept risk sentiment on the upside and stock markets in Europe as well as in Asia posted small gains.

Market attention is now shifting to US economic data on schedule this week, including the first estimate of second quarter GDP growth on Friday.

Wholesome forecasters expected the data to prove as disappointing as other recent data has from the US, others are looking for surprises on the upside.

  - I-Net Bridge

 

 
 
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