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UPDATE 1-South African rand rallies 1% to one-month best, stocks weaker - REUTERS

OCTOBER 22, 2019

(Adds latest figures, analyst comment)

JOHANNESBURG, Oct 22 (Reuters) - South Africa’s rand powered to a one-month best on Tuesday, lifted by a brightening outlook on a trade deal between China and the United States and locally by a second day without electricity blackouts.

Stocks slipped despite grocer Pick n Pay’s shares climbing by their most in 18 years, with the bourse dragged down by resource miners and rand hedges.

At 1630 GMT the rand was 1.05% firmer at 14.6150 per dollar, its best level since Sept. 19, compared to an open of 14.7550.

The rand marked a fourth consecutive session of gains, shaking off lingering concerns about electricity supply after shock outages last week as state firm Eskom said failures at some of its stations had throttled capacity.

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On Tuesday Eskom had not cut power since Saturday, and was further boosted by parliament’s decision to greenlight a 59 billion rand bailout proposed by the treasury in July.

Progress in trade talks between Beijing and Washington has also helped the rand as emerging market risk appetite picked up globally.

Government bonds also rallied, with the yield on the benchmark 2026 bond down 7 basis point to 8.205%.

In stocks, the Johannesburg All-Share index fell 0.31% to 55,936 points, while the Top-40 index dipped 0.45% to 49,610 points, with gold miners the main drag on the bourse.

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“Anglo American and its subsidiaries Kumba Iron Ore and Anglo Platinum all released production reports for the third quarter, which has seen these shares trade mostly lower on the day,” said senior analyst at IG Markets at Shaun Murison. Anglo Platinum was down 3.82% to 105.40 rand, Kumba fell 6.38% to 336.81 rand. Petrochemical giant Sasol saw a 7.38% slide on the day to 267.22 rand.

Supermarket chain Pick n Pay Stores Ltd led the All-Share, up more than 10.54% to 67.96 rand after a .5% rise in first-half earnings. (Reporting by Mfuneko Toyana)

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