S.Africa rand softer, resources lead bourse up

Posted 04 April 2008 @ 10:15 pm EET     Print     Reprint     E-Mail     Comments

JOHANNESBURG (Reuters) - South Africa's rand ended the week softer against the dollar in volatile trade on Friday, while local shares gained over one percent, buoyed by stronger resource and banking stocks.

The Top-40 index grew 1.51 percent at 28,204.58 points and the broader All-Share index rose 1.39 percent to 30,396.34 points.

The rand was trading at 7.8060 against the dollar at 1551 GMT, about 0.3 percent weaker than its New York close of 7.7825 on Thursday.

The rand hit a four-week high of 7.7050/dollar on Thursday but concerns about Turkey's economy and lingering worries about the U.S. economy have weighed.

"It has been tracking Turkey quite closely, and there was also the weaker U.S. payrolls report, which has weakened the dollar. We'll see how the (U.S.) stocks will do," said a local trader.

Emerging markets weakened on Thursday after international ratings agency Standard and Poor's revised its outlook for Turkey to negative.

Data data showed U.S. employers cut payrolls for a third straight month in March, which some investors took as increasing the chance of more aggressive U.S. interest rate cuts which undermine demand for the dollar.

Bonds ended weaker, with yields on the 2010 bond up 1.5 basis points to 9.5 percent and those on the 2015 issue ticking up 0.5 basis points to 8.975 percent.

Resource stocks led the local bourse higher.

"It's a good performance given that the rest of the world is negative," Garth Mackenzie, a trader at BoE Private Clients said.

"We're largely driven by resources, Anglo and Billiton were big gainers on the day, but we've seen fairly broad based buying in our market... the banks have done quite nicely."

Mining and bourse heavyweight BHP Billiton performed the best adding 3.96 percent at 249.60 rand. Rival Anglo American closed up 2.7 percent at 487.45 rand.

Despite the gold price gaining on the back of a weaker dollar, local gold stocks did not make significant jumps.

"I think there was bit of hype around gold shares and a lot of people went into them... now that they're not shooting higher like everybody had anticipated, there's probably a bit of selling coming in," Mackenzie said.

Gold giant AngloGold shed 0.09 percent at 275.75 rand, while rival Harmony lost 1.64 percent at 92.10 rand.

A drop in the platinum price and profit taking after good gains in the week pushed Impala Platinum's shares down 2,84 percent to 325.50 rand.

Traders said companies like Impala, which have interests in Zimbabwe, had also fallen on the back of a drop in confidence as election results for the country with the world's highest inflation rate remained unknown.

Pretoria Portland Cement Company was the biggest loser, dropping 4.16 percent to 41.20 rand from profit taking after recent gains, traders said.