The slump in the rand sparked by the sacking of South Africa’s finance minister has taken a chunk out of the share prices of FTSE 100 companies with significant exposure to the country.
Insurer Old Mutual (OML), which is listed in both London and Johannesburg, fell 8.8% to 158.9p, in its second day of heavy falls. The shares are now down 18.5% over the last two days. Mondi (MNDI), the packaging and paper company with a South African division, fell 2% to £12.90.
That weighed on the FTSE 100, which dropped 26 points, or 0.4%, to 6,062.
The fall-out extended outside the top 100 with South African bank and asset management group Investec (INVP) dropping 8.1% to 431.9p.
South African platinum miner Lonmin (LMI) was meanwhile the heaviest faller on the FTSE Small Cap index, down 6.8% at 0.96p.
The rand hit an all-time low after South Africa’s president Jacob Zuma sacked finance minister Nhlanhla Nene (pictured), who has been attempting to rein in government spending as the country’s economy struggles to grow.
‘Removing him after just two-and-a-half years and installing the unknown David van Rooyen is a decision that has sent the rand to all-time lows and resulted in foreign investors running for the savannah, worried about the impact on an already troubled yet key mining sector,’ said Mike van Dulken head of research at Accendo Markets…Read more at New Model Adviser