Africa-Press – South-Africa. South African stocks touched their highest levels since January, Eurobonds rose, and the rand surged by the most this year after the publication of an opinion poll, which was seen boosting the odds of a market-friendly coalition emerging from national elections next month.
The South African currency advanced as much as 1.7% to 18.7223 per dollar, its biggest increase since mid-December on a closing basis and the biggest gain among emerging-market currencies globally on the day, after a poll by Ipsos showed backing for the ruling African National Congress dropping to 40.2%. That’s down from 40.5% in a survey published on Feb. 6, and 43% in October.
Meanwhile, support for the main opposition Democratic Alliance strengthened to 21.9% from 20.5% in February, the poll showed.
“The poll is market- and rand-supportive because it shows lower support for the ANC and higher support for the DA, suggesting the ANC will need support, and that the DA could bring that in a possible coalition that would likely be rather market-friendly,” said Sébastien Barbé, head of emerging-market research and strategy at Credit Agricole.
A coalition between the two parties could be pro-reform and in favor of larger participation of the private sector in the economy, Barbé said.
The poll suggested that the newly formed uMkhonto weSizwe Party, backed by former President Jacob Zuma, is pulling some support away from the leftist Economic Freedom Fighters. Ipsos placed the EFF at 11.5%, down significantly from 19.6% in February. The Zuma-backed MKP was at 8.4%.
The benchmark FTSE/JSE All Share Index was up 1.7% to trade at its highest since Jan. 2. Yields on benchmark rand-denominated bonds fell 18 basis points to 12.28%, the most in a day since Dec. 14.
South Africa’s dollar-denominated bonds were nine of the ten best performers on Friday in a Bloomberg index of emerging and frontier hard-currency debt.
The Ipsos poll was based on the views of 2,545 registered voters. Interviews were conducted by Ipsos interviewers in the homes and home languages of respondents, the company said.
Interviews were conducted from 9 March 2024 to 15 April 2024. The vote is slated for May 29.
“IPSOS were the polling agency that were the closest to getting the end result right” in 2019, said Razia Khan, head of research at Standard Chartered Bank.
“But we caution – still – that quite a lot can change before election date, given the ANC’s traditional strength in rallying voters ahead of the polls.”
For More News And Analysis About South-Africa Follow Africa-Press
