UPDATE 1-South Africa's rand firmer, stocks slide in nervous trade
(Adds latest prices, analyst comments)
JOHANNESBURG, Oct 22 (Reuters) - South Africa's rand rallied to its strongest point in a month on Thursday, extended its winning streak to a fifth consecutive session as optimism about a new stimulus package in the United States continued to feed demand for risk currencies.
At 1540 GMT the rand ZAR=D3 was 0.67% firmer at 16.2150 per dollar, its strongest since Sept. 21, from an opening level of 16.3400.
"That the market is currently trading on stimulus headlines means relatively higher-Beta currencies such as the rand are likely to be subject to big intraday price swings, as has been the case in recent sessions," said economists at ETM Analytics.
Hopes for a fresh U.S. coronavirus relief package ahead of the Nov. 3 presidential elections remain up in the air, but optimism that they will soon be concluded has kept high yielding currencies bid with investors scouring the global market for returns. the market is on watch ahead of the medium term budget speech due next Wednesday, when the extent of the country's fiscal problems should become clearer.
"The address, which could very well be a watershed moment for SA as a country, is lingering in the back of traders' minds and could keep any ZAR-bullish momentum at bay heading into the weekend," ETM economists said.
Government bonds were firmer, with the yield on the benchmark 2030 bond ZAR2030= down 3 basis point to 9.265%.
Stocks fell, in line with shares around the world amid a global surge in COVID-19 cases. Johannesburg Stock Exchange's blue-chip Top-40 Index .JTOPI lost 1.23% to 50,277 points. The broader All Share Index .JALSH fell 0.99% to 54,796 points.
The biggest losers were gold miners, dragged lower as global bullion prices dropped 1% after better-than-expected U.S. jobs data, dimming demand for the safe-haven.
Gold Fields GFIJ.J and Harmony Gold HARJ.J , down 8.58% and 6.87% respectively, were followed by their peers. Clicks CLSJ.J closed 3.11% lower despite posting a jump in annual profit, setting it apart from other consumer-focused firms, including other retailers and banks, which benefited from a stronger rand.
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