The rand firmed to a near 19-month high on Friday over dovish comments by the US Federal Reserve, which gave impetus to emerging market currencies against the retreating greenback.
Stocks fell, with Net1’s Johannesburg-listed shares taking a hit over a court that affected its operations.
At 23:50 on Sunday, the rand traded at 12.7271 versus the dollar, up 0.31% – its strongest level since August 2015.
The rand has ticked up against the dollar as investors booked profit on the greenback after the Fed raised interest rates but signalled gradual policy tightening.
“The rand strengthened to a 19-month high against the greenback this week after the US Fed raised interest rates by 25 basis points, but sounded less hawkish than the market had anticipated,” said NKC African Economics in a note.
In fixed income markets government bonds weakened, and the yield for the benchmark instrument due in 2026 rose 2 basis points to 8.490%.
On the bourse, the benchmark Top-40 index fell 0.47% to 45,309 points while the All-Share index dropped 0.38% to 52,550 points.
Net1’s shares in Johannesburg dropped 2.51% to R165.74 after the Constitutional Court ordered the government to continue with a 12-month contract with its unit, bringing an end to a fiasco that had threatened the payment of benefits to 17 million people.
Investment company Allan Gray said its 16% stake in Net1 allowed it to hold the firm to account over the scandal.
“That black stain on them now with Allan Grey not too happy with the board and all those things add up to give you a rather nasty picture but the volumes in the shares don’t reflect a panic sellout either,” said Independent Securities trader Ryan Woods.
Further losses came from the banking sector which fell 0.7% after it saw some profit taking following its rally in the previous session.
Standard Bank fell 1.24% to R159.89 and Nedbank dropped 1.11% to R265.00.