South African assets down as Britain's move fears spook markets

dimeji akinloye

July 7, 2016 3:22 AM

At 1529 GMT the rand traded 0.6 percent weaker at 14.8410 versus the dollar, compared with Tuesday's close at 14.7550.

The Union Jack (bottom) and the European Union flag are seen flying, at the border of Gibraltar with Spain, in the British overseas territory of Gibraltar, historically claimed by Spain, June 27, 2016, after Britain voted to leave the European Union in the EU Brexit referendum. REUTERS/Jon Nazca

South African assets fell on Wednesday, July 6, as risk appetite was subdued by renewed global fears over the economic impact of Britains eventual departure from the

"At the moment market is driven by risk-off sentiment, it is still regarding Brexit," Treasury One dealer Andre Botha said.

"We thought the Brexit risk has subsided but yesterday some people came out to say they expect the British economy to suffer more than they initially thought. That brought the pound down but it also increases worldwide risk," Botha said.

The rand has also come under renewed pressure as recent data points to sluggish growth in Africa's most industrialised economy, leaving it vulnerable to sovereign credit rating downgrades before yearend. South African government bond yields fell, with the yield on the 2026 benchmark down 1.5 basis points at 8.81 percent.

Stocks also fell in line with global markets. Exceptions included gold mining shares, which were lifted after the spot price hit two-year highs on a flight to safe havens.

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Johannesburg's Gold Mining Index rose 6.54 percent to 2,710.27 points.

The benchmark Top-40 index shed 1.83 percent to 44,501.22 points while the wider All-share index closed 1.66 percent lower at 50,811.66 points.

dimeji akinloye