JOHANNESBURG: South Africa's rand weakened on Wednesday in volatile trade as markets awaited the outcome of talks between the ruling African National Congress (ANC) leader Cyril Ramaphosa and President Jacob Zuma over a transition of power.
Stocks rose as buyers came back into the banking and financials sectors which have seen a sell-off in recent weeks.
At 1521 GMT the rand was 0.44 percent weaker at 11.9650 per dollar, having rallied as far as 11.8750 earlier in the session.
Zuma, in power since 2009 and beset by corruption allegations, has been in a weakened position since Deputy President Ramaphosa replaced him as ANC leader in December. Ramaphosa has talked of a transition of power since he took over as leader of the ANC.
"The political drama in South Africa continues," Commerzbank analysts said in a research note. "At present it looks as if the Zuma era is finally nearing its end, which would of course be good news for the rand."
The rand has tended to strengthen on signs that Zuma could step down early.
Bonds were firmer, with the yield on the benchmark paper due in 2026 down 7 basis points to 8.4 percent.
On the bourse, the benchmark Top-40 index rose 0.65 percent to 50,182 points while the All-Share index was up 0.9 percent to 56,886 points.
The banking sector rose 3.42 percent and financials lifted 4.4 percent as buyers came back into previously hard hit shares, with the blue-chip JSE Top-40 index closing up for the first time in more than a week.
Nedbank rose 5.87 percent to 269.96 rand, FirstRand gained 3.64 percent to 66.94 rand and Standard Bank strengthened 2.71 percent to 199.00 rand.
"They were the ones that were knocked down the most in the sell-off so they the ones where the recovery is," said Cratos Capital equities trader Greg Davies.
Further gains were curbed by the resource sector which came under pressure amid a stronger rand, with Impala Platinum down 6.32 percent to 30.07 rand and Harmony Gold weakening 2.08 percent to 19.75 rand.
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