The US dollar and oil prices fell on Wednesday after President Donald Trump’s Republican party lost control of Congress in the US midterm elections. At the time The South African published its report, the rand was trading at R16.45 to the dollar.
Brent crude oil was priced at $101.76 a barrel at the same time, according to the publication.
“Investors are trying to get their heads around what a Democrat landslide means for financial markets,” said Russ Mould, investment director at AJ Bell.
Mould said the big risk was uncertainty about how Trump could act in the coming months after such a result.
Democrats won control of both houses of Congress in a landslide. This gives them the power to block laws and launch investigations into Trump’s administration. They can also block his picks for judges and senior government posts.
The dollar sank against other major currencies. Traders feared the result could lead to political gridlock in the US, after Trump warned that he would become “Mr Veto”.
Chris Weston, an analyst at broker Pepperstone, said Trump still had “considerable executive authority”. He said the possible impact was “far from straightforward”.
Shares in technology companies fell on suggestions that Democrats could make rules for artificial intelligence a priority.
European stock markets rose in Wednesday morning trading. Markets in London, Frankfurt and Paris all gained more than one percent.
Investors in Europe brushed off official data that showed eurozone inflation had reached a three-year high of 4 percent.
Shares across Asia mostly performed well before Europe opened. Tokyo ended lower as its tech sector struggled.
Bond yields did not swing as sharply as they had in earlier trading. Gold gained because investors see it as a safe place to keep their money.
Tens of millions of Americans voted in the polls, which were seen as a test of the White House. Anger has been growing over rising petrol prices, the effect of tariffs and the Iran war.
Investors also kept watching company results for the third quarter. BMW said on Wednesday it would deepen its planned job cuts. The carmaker reported a drop in third quarter profit, hit by tough competition and falling demand in China, the world’s largest car market.
Google said it planned to invest $15 billion in Malaysia over the next two years to build data centres and other infrastructure.
In South Africa, the fuel price depends on two main factors. These are the international price of petroleum products, which is driven mainly by oil prices, and the rand to dollar exchange rate used to buy those products.
Source: this article is based on reporting by The South African. Image: The South African. Written with the help of AI and published by the Tzaneen Voice Business desk. See our Editorial Standards.
Anelisa Nkuna covers business and money news for Tzaneen Voice. Anelisa reports on the rand, fuel prices, interest rates, jobs, Eskom, Transnet, farming and company results. The aim is simple: explain what the numbers mean for household budgets, small businesses and workers in South Africa.