Rand on the back foot in subdued trade, stocks open firmer

December 23, 2015 8:38 AM

Government bonds were weaker, with the benchmark paper due in 2026 adding 1.5 basis points to 9.46 percent. as thin volumes exacerbate moves.

The hand of Former South African Reserve Bank Governor Gill Marcus is seen holding South Africa's new rand banknotes - which feature an image of former president Nelson Mandela on the front in a file photo. REUTERS/Siphiwe Sibeko

South Africa's rand edged down after briefly making gains against the dollar in early trade on Wednesday as the greenback steadied after mixed U.S. data, adding pressure for the battered local currency.

U.S. home sales unexpectedly suffered their steepest drop since July 2010 on Tuesday, weighing on dollar sentiment.

Separate data showed the world's largest economy's gross domestic product grew in the third quarter.

The greenback has since recovered slightly, with the dollar index, which tracks the greenback against a basket of six rival currencies, making small gains, but was still well below a two-week high of 99.294 set on Thursday last week.

By 0710 GMT the rand weakened 0.20 percent to 15.1950 per dollar compared to 15.1640, where it closed overnight in New York.

"Global headwinds and strong U.S. dollar indirectly weigh on business investment," analysts at NKC African Economics wrote in a note.

Trade is expected to be subdued for the remainder of the year as most market players are already on holiday, and with no major economic news to provide direction for the rand.

On the equities market, stocks opened slightly higher. By 0707 GMT the Johannesburg Securities Exchange's Top-40 index rose 0.37 percent at 45,082 points after rising more than 1 percent in the previous session, bolstered by bargain hunters.

The broader all-share index added 0.35 percent to 49,954 points.