South Africa

Buying the dip has driven investor activity this week with South African bonds causing them to rally despite S&P downgrading the country, and a strong indication that Moody’s will drop its rating to junk in February.

Investors in South African bonds have bought on the dip because, even as the country’s economic outlook deteriorates, the only way for bonds is up. But positive reinforcement of the country’s poor governance and deteriorating economy reduces the incentive to reform and only postpones what will be a bigger investor stampede for the exit when the time comes.

Growthpoint, the South African listed property investment holding company, has picked banks for its first public deal since 2011. Though deemed an emerging market trade because of the jurisdiction of the issuer, it also appeals to corporate or high grade funds.

After a brief sell-off in response to S&P’s decision to cut South Africa’s foreign and local currency issuer rating last Friday, South African assets rallied on Monday, as investors buy on the dip — even though the country’s economic outlook is on a downward trajectory.

Energy and chemical company Sasol has signed South Africa’s biggest loan deal of the year so far — a $3.9bn revolving credit facility with 17 banks.

Nasdaq, the exchanges and trading technology company, is launching a blockchain-based product in South Africa, designed to make shareholder voting more efficient.

Money is pouring out of South African assets amid national Treasury upheaval and a warning from state owned electricity company Eskom that its liquidity levels are below where the company wants them amid a tough funding environment.

FirstRand Bank has launched its second syndicated loan of the year, two weeks after signing a $540m loan with Asian banks. The new $500m loan is aimed at international banks, and is priced more tightly than other loans for South African banks this year.

The book for Liquid Telecom's $180m tap of its $550m 8.5% July 2022s has reached $400m.

South Africa’s FirstRand Bank has successfully completed its Asian-bank focused syndication for $540m, an increase from its launch amount of $250m.

South Africa’s dollar bonds have managed to scrape through the rout on some of the country’s risk assets, after local media said the deputy president could be removed from his position and tried for treason.

Anil Agarwal, founder of mining group Vedanta Resources, has managed to surprise the stockmarket with the same trick twice. But as Jon Hay and Aidan Gregory write, his intentions in buying another £1.5bn of shares in Anglo American are anything but clear, and he is paying a high price for influence.