The markets are starting to feel the heat from the Afghanistan turmoil, with the rand breaching the critical R14.90-level against the US dollar as risk-off sentiment entered the market overnight on the political tension, and as the Delta strain of the Covid-19 virus continues to grab hold of the market, writes TreasuryONE.
Where the US markets saw the chaos as a mere blip, the Afghani plummeted as the country’s central banker fled and Pakistan’s sovereign dollar bonds due 2031 saw their biggest decline since the government priced the notes in March.
Investors are concerned over any impact on law and order in Pakistan, and whether “global forces will try to isolate Pakistan” due to its alleged support of the Taliban, Abdul Kadir Hussain, the head of fixed-income asset management at Dubai-based Arqaam Capital told Bloomberg.
Gold also saw renewed support thanks to its safe-haven status, with the Afghanistan situation pulling down stocks as investors move some liquidity to gold, Kinesis market analyst Carlo Alberto De Casa told MarketWatch.
But although Afghanistan remains a threat, for now it is not the biggest obstacle for the markets. Instead, the focus is on the Covid-19 Delta variant and the US Federal Reserve.
Here’s a roundup of the world’s top and most interesting headlines:
SA Business
SA company gets the green light to manufacture Covid-19 rapid test kits – TimesLive
Tech revolution will create jobs, not take them – Naspers SA CEO – Fin24
Here it is: The toxic stockpile of chemicals in torched United Phosphorus Limited Durban warehouse – Daily Maverick
Global Business
‘Cattle boy’ millionaire: Meet Zambia’s new president Hakainde Hichilema – News24
Tencent Music takes copyright rules in stride, earnings beat estimates – Reuters
Jeff Bezos’ Blue Origin sues NASA, escalating its fight for a Moon lander contract – The Verge
Markets
Asia shares fall as investors eye rising COVID-19 cases, Afghan crisis – Reuters
Yuan’s global use faces test as Xi’s reforms rattle markets – Bloomberg
Aberdeen’s Young adds Tencent, keeps China bets during selloff – Bloomberg
Opinion
Political power play: Thandi Modise’s sudden attraction – Daily Maverick
What next for Afghanistan’s economy? – BBC
Propaganda without shame: Zuma ‘detention without trial’ claim is a mockery of suffering endured under apartheid – Daily Maverick
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