JOHANNESBURG: South Africa's stocks rebounded on Tuesday, as market appetite for risk assets improved after a selloff in global markets, though a surge in COVID-19 cases kept investors worried about the near-term economic outlook.

Risk appetite took a blow on Monday as a rapid increase in cases of the Omicron coronavirus variant forced countries to reimpose restrictions.

On Tuesday investors weighed up how badly these measures would hit the global economy.

"The world is starting to realise that COVID isn't as bad as everybody thought, even though it's still with us but the death rates at the moment seem to be way lower than previous variants," Independent Securities trader Ryan Woods said.

"Our markets were very hard hit in the last few days so this is more of a relief rally so to speak."

Gold, platinum and diversified miners as well as oil stocks grabbed the limelight, with Impala Platinum, Sibanye Stillwater and petrochemical producer Sasol up 4.40%, 4.73% and 3.60% respectively.

Overall, the Johannesburg All-Share index closed up 1.47% at 71,119 points, while the Top-40 index rose 1.51% to 64,611 points.

South Africa's rand falls as emerging market currencies weaken on Omicron worries

At 1457 GMT, the rand traded at 15.8700 against a recovering dollar, 0.32% weaker than its previous close.

The US dollar recouped some overnight losses, also benefiting from improved risk sentiment.

In fixed income, the yield on the benchmark 2030 government bond was up 10.5 basis points to 9.325%.