UPDATE 1-South African rand on track to clock weekly gains

  • Reuters
  • Forex News
UPDATE 1-South African rand on track to clock weekly gains
Credit: © Reuters.

(Updates rand, bonds; adds stocks)

JOHANNESBURG, Aug 21 (Reuters) - South Africa's rand was on track to clocking weekly gains on Friday as the dollar was on the defensive on worries about the health of the U.S. economy.

At 1500 GMT, the rand ZAR=D3 was trading at 17.1375 to the dollar, 0.7% stronger than its previous close and on course for gains of more than 1% this week.

"The rand which remains a proxy for emerging market extended its recent gains as the dollar weakened on worries about the health of the U.S. economy," said Lukman Otunuga, senior research analyst at FXTM.

"If the dollar remains depressed and unloved, the rand could edge back towards 17.00 in the week ahead."

The dollar was weighed down by concerns over the strength of a U.S. economic recovery following weaker-than-expected jobs data. the absence of major domestic data releases the rand has moved mainly on global factors this week.

Stocks rose on Friday led by South African banks as more clarity emerged on the outlook of their performance with Nedbank NEDJ.J joining FirstRand Bank FSRJ.J and Absa Group ABGJ.J in announcing trading statements for half year, while Africa's biggest Standard Bank SBKJ.J declared its results on Thursday.

But the market overall ended the week down over 2% from last week's close as rising coronavirus infections globally and the U.S.-China trade tensions continued to weigh heavy on the Johannesburg Stock Exchange (JSE).

The benchmark FTSE/JSE all share index .JALSH ended 0.25% higher to 55768 points while the top 40 companies index .JTOPI closed up 0.21% to 51,489 points. The bank index .JBANK , which has mostly been a laggard in stock performance since March mid crash, was up 3.86% on end of day's trading.

Government bonds were a shade weaker, with the yield on the 2030 instrument ZAR2030= up 0.5 basis point to 9.28%.

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