JOHANNESBURG: South African assets firmed on Thursday as global investors became less adverse to risk, but the rand looked vulnerable to a credit rating review from Standard & Poor's due on Friday.
Stocks recovered after skidding lower for two sessions in a row, while bonds were mixed. At 1543 GMT, the rand traded at 15.5700 per dollar, 0.32 percent firmer from its New York close on Wednesday, its third straight session of gains.
"Market players are quite reluctant to take on any new positions ahead of tomorrow's S&P credit rating event risk, and we also have US payrolls data tomorrow and this is keeping a cautious tone in the market," ETM Analytics market analyst Jana van Deventer said.
Standard & Poor's currently rates South Africa one notch above subinvestment grade.
Helping the rand was a pause in the recent dollar rally, weighed down by uncertainty over whether the US Federal Reserve will raise interest rates in June or July.
The greenback had strengthened to a two-month high against a basket of currencies at the start of the week, after US Federal Chair Janet Yellen kept alive the possibility of a rate hike at this month's meeting. Global investors will now focus on U.S non-farm payrolls on Friday. A solid reading could again heighten expectations for a move as early as the Fed's June 14-15 policy meeting.
In fixed income, the yield for the benchmark instrument due in 2026 was down 1 basis point to 9.31 percent.
On the bourse, banking group FirstRand Ltd was among the advancers after the Competition Commission recommended that its acquisition of Target Properties from a unit of MMI Holdings be approved without conditions.
FirstRand rose 2.6 percent to 44.61 rand while MMI Holdings added 4.6 percent to 23.59 rand.
The benchmark Top-40 index ended 0.35 percent higher at 47,677.99 while the broader All-Share added 0.37 percent to 53,716.91.
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