By Jackie Cameron
- The Rand weakened in early trade on Monday, as investors fled riskier assets following the rapid spread of the coronavirus outside mainland China. “A sharp rise in the spread of the Covid-19 virus in South Korea, Iran and Italy is causing renewed market jitters,” said Bianca Botes, treasury partner at Peregrine Treasury Solutions. South Korea put the country on high alert as the number of infections jumped to over 700 and deaths rose to seven, reports Reuters. In Italy, officials said a third person infected with the flu-like virus had died, while the number of cases jumped to above 150 from just three before Friday, says the newswire. Iran, which announced its first infections last week, said it had confirmed 43 cases and eight deaths.
- Even without a single confirmed case, sub-Saharan Africa may be the region hardest hit outside of Asia by the spread of the coronavirus, experts are warning. The outbreak has shut down entire swathes of the Chinese economy, threatening world economic growth and curbing appetite for oil and metals that are the lifeline of many African nations, reports Bloomberg. A slowdown in the No. 2 economy and a 5% drop in oil prices over one year could mean $4bn in lost export revenue for sub-Saharan Africa, or the equivalent to 0.3% of its gross domestic product – more than any other continent outside of Asia, according to a study by the Overseas Development Institute. “Many developing countries are increasingly dependent on China for trade, both for imports and exports,” Dirk Willem te Velde, principal research fellow at the institute, told Bloomberg.
- A detailed investigation into Eskom reveals that it will take at least five years to get the power utility’s plants to a place where loadshedding is not needed, reports MyBroadband. A detailed investigation into Eskom revealed that it will take at least five years to get the power utility’s plants to a place where loadshedding is not needed, says the website. It quotes energy advisor Ted Blom, who said on SABC News that claims by Eskom and energy minister Gwede Mantashe that loadshedding will last for between 18-24 months are misguided. He said the energy minister is not close enough to Eskom’s operations to know what is going on, and the new CEO André de Ruyter has not been there long enough to make accurate predictions. “I have gone into the situation at Eskom in detail with an IMF (International Monetary Fund) subcontractor with vast experience,” he said. “Our estimate is that it will take at least five years under the Eskom scenario of refurbishing the boilers.” Other analysts agree with Blom.
- Gold hovered near $1,700 an ounce, extending its rally to the highest in more than seven years, as investors pile into haven assets, reports Bloomberg. On the Johannesburg Stock Exchange, gold company stocks soared, with Harmony gaining more than 14%. Petrochemicals group Sasol’s half-year profits plunged, sending shares to a 14-year low on Monday, as a result of problems at its Lake Charles chemicals project and softer chemical and Brent crude oil prices.
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