JOHANNESBURG: South African traders yesterday dismissed fears of a “Mandela crash” when the icon dies, after steep selloffs hit the rand and Africa’s largest stock exchange.
The 94-year-old critically ill statesman has not been involved in politics for more than a decade.
But that has not stopped some drawing a line between his hospitalisation and recent market weakness. As Mandela’s condition worsened on Monday, local news outlets screamed headlines like “Rand hit by Mandela health fears.”
The Johannesburg Stock Exchange is down around nine percent this month and the rand has lost 1.6 percent against the dollar since Mandela was hospitalised on June 8.
But traders said suggestions that any link to Mandela’s death was overblown. Adriaan du Toit, a strategist at Citi, said any Mandela-fuelled sell-off was “not fundamentally supported,” because of his “negligible” impact on policy.
Mandela remains a moral beacon which all South African leaders are now compared to, but even during his 1994 to 1999 presidency he was more occupied with reconciliation than economic policy.
That has not stopped speculation that investors are concerned about political risk and even potential unrest when Mandela dies.
AFP
