(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.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.