RAND yesterday dropped to the lowest level against the dollar near since 1971 after South Africa's President, Jacob Zuma, Finance Minister abruptly ousted Nhlanhla Nene. To add to the uncertainty, David Van Rooyen was elected as his successor. Little-known members of Parliament are unlikely to oppose the President's plan to push forward with a proposal to build the nuclear power industry and State-owned airline bailout.
The announcement came less than a week after the company's credit ratings pushed the nation closer to junk status, citing worries over the economy and a rise in debts as inflation and interest rates rise. Mining and manufacturing are already under pressure because of the fall of the price of the metal and electrical constraints.
"In Africa, Old Mutual has significant growth opportunities, but foreign exchange headwind from significant exposure to the rand will stifle stock price," said RBC Capital Markets. The broker lowered its stance towards dual-listed Old Mutual to ' underperform ' from ' sector perform ' and cut its target price to 180p from 200P. Further raised concerns about investor attitudes for coverage ratio Solvency II, which expects the going towards the lower end of the peer group.
By 15:14 GMT, Old Mutual's stock price has fallen by 11.96 173.60 percent to p. Financial services company was one of the worst performance on the FTSE 100, the following Sports Direct (LON: SPD), which today revealed the results of the half-year.
At 15:58 GMT, Thursday 10 December, Old Mutual plc share price 176.25 p.
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