Rand gains as investors bet ECB will delay tapering

South Africa's rand firmed on Wednesday as investors ignored local factors and bet on the European Central Bank delaying plans to taper its asset buying programme.

By 1519 GMT the rand had firmed 0.87 percent to 13.7100 per dollar, shrugging off September's weak business confidence print.

"The rand initially recovered during Wednesday’s European session as speculation that the European Central Bank (ECB) would start to taper its asset buying program died down after the ECB’s media officer said that the bank had not discussed doing so at its last meeting," NKC African Economics economist Gerrit van Rooyen told Reuters.

The currency gave back some of its gains after some better-than-expected U.S. data releases, but resumed its rally in late afternoon trade.

On the bond market, government bonds weakened, with the yield on the benchmark 2026 issue up 9 basis points to 8.65 percent.

“South African bond yields also knee-jerked higher following positive US durable goods and factory order numbers,” said Van Rooyen.

On the bourse, the benchmark Top-40 index fell 0.36 percent to 45,308 points, while the All-Share index dropped 0.33 percent to 51,868 points.

Local gold mining stocks remained under pressure, despite spot gold prices rising 0.5 percent, following a plunge to its three-month low on Tuesday in a sharp sell-off triggered by speculative selling and a break of key technical support levels that continued to weigh on investors.

"It has recovered a bit from yesterday but is still weaker than it was as a result we have seen some selling taking place in that sector," said Independent Securities trader Ryan Woods.

The biggest loser on the bourse was Sibanye Gold which fell 7.64 percent to 41.34 rand extending its losses from the previous session, when it had to suspend its Cooke mining operations due to violence between rival unions.

The mine has since been reopened.

Further losses on the bourse were curbed by distributor of prepaid airtime, Blue Label Telecoms, which closed up 8.89 percent to 20.20 rand after agreeing to pay 5.5 billion rand ($400 million) for a 45 percent stake in mobile phone group Cell C.

Trading volumes were low, with 199 million shares changing hands compared with last year's daily average of 296 million.