Markets LIVE: US-China trade talks end early, little progress

US cuts rates but rand weakens after not-so-dovish Powell speech

The US cut its interest rate by 25bps as expected, but the rand weakened on the back of Fed chairman Jerome Powell's speech which had a tone less dovish than expected.

"Although the rand did not react to the announcement, it swiftly made its way weaker as Jerome Powell delivered his address," Bianca Botes, Treasury Partner at Peregrine Treasury Solutions said.

"The trade war is also creeping back into the spotlight as President Trump’s current term starts moving to an end."

"The rand starts the day softer at R14.36/$, R15.86/€ and R17.42/£ while the new trading range is set at R14.25 to R14.40," she said.

Dollar strengthens after Fed; stock slide eases

Andreea Papuc, Bloomberg 

The dollar climbed in Asian trading after Federal Reserve Chairman Jerome Powell warned against expecting a lengthy US monetary easing cycle.

Stocks slid by less than seen on Wall Street, with Japanese shares in particular helped by the yen’s decline.

Japanese benchmarks opened sharply lower before recouping those losses as the yen slid. US stock futures were little changed after an early drop, though European futures declined. The S&P 500 Index lost 1.1%, though closed off of its lows after Powell also said that he wasn’t ruling out a sequel to Wednesday’s cut.

Ten-year Treasuries gave up gains made after the Fed’s meeting, where policymakers also brought forward their plan to abandon the run-down in the bond portfolio. Hong Kong and Chinese underperformed. Oil prices tumbled. The dollar hit a two-month high.

Fed cuts rates by quarter point and signals potential for more

The Federal Reserve reduced interest rates for the first time since the financial crisis and hinted it may cut again this year to insulate the record-long US economic expansion from slowing global growth.

Central bankers voted, with two officials dissenting, to lower the target range for the benchmark rate by a quarter-percentage point to 2%-2.25%.