Morning report (7.5)

Local equities closed 1.5% lower yesterday, despite the weakening of the currency, reports Nico Kelder, economist at the Efficient Group.

It seems as if equities are ignoring the movements of the currency and perhaps they are predicting the movements of the next day.

The rand lost around 1.5% against the majors after the Bank of England rose hiked interest rates by0.25-percentage points. Dollar firmness returned as the greenback climbed almost 1%.

A rising dollar pushed commodities lower with gold and platinum dropping 1.5% and oil close to 1%.

European and US markets also closed more than 1% in the red (DAX closer to 3%). The negative sentiment spilled over to the Far East which is trading lower this morning.

We expect that the negative international sentiment will weigh local equities down. Buckle your seatbelts, the rollercoaster is gaining speed.