Johannesburg - South Africa's rand strengthened against the dollar on Monday in volatile trade as investors waited on the sidelines for United States jobs data due on Friday.
Stocks opened strongly, with the benchmark Top-40 index up 0.48 percent at 07h05 GMT.
Government bonds were flat in early trade after weakening in the previous week. The benchmark issue due in 2026 was unmoved at 8.495 percent.
By 07h05 GMT the rand had gained 0.25 percent to 13.8500 on increased market volatility, after edging close to record lows earlier in the session on the likelihood of a US rate hike in December.
“There may be a small chance of some rand appreciation based purely on the last lower high that was formed on Friday,” said Warrick Butler, a currency trader at Standard Bank.
Positive growth data from the United States along with comments from the central bank backed the case for the first interest rate hike by the Federal Reserve since 2006, pushing most emerging assets lower.
The rand shed well over four percent in the previous week on its way to an all time low of 14.0860 versus the greenback, buckling under weight of concerns about weak domestic and global growth.
“Global sentiment remains fragile, concerned by the Fed and China, and expectations are that volatility will continue,” said John Cairns of Rand Merchant Bank.
Gross domestic product in the US rose at a 3.9 percent in the second quarter, up from the 3.7 percent reported last month, further evidence to support a Fed hike in 2015 ahead of closely watched jobs numbers on Friday.
More signs of a slowdown in China's economy upped the pressure on emerging markets, with data early on Monday showing profits earned by Chinese industrial companies declined 8.8 percent in August.
REUTERS