Picture: Denis Farrell / AP

JOHANNESBURG - The rand firmed yesterday, snapping a three-day losing streak, helped by some investors taking profits from the dollar’s recent rally and short covering triggered by the currency approaching technical support levels.

Stocks dropped led by Harmony Gold, which weakened after it said it might consider a rights issue to repay a loan. At 5pm, the rand bid at R13.5286 to the dollar, 2.80c stronger than at the same time on Wednesday.

A combination of a firmer dollar, higher-than-expected inflation print and negative sentiment spurred by recent cabinet changes had pushed the rand to its weakest in nearly a week towards short term technical support around the 13.60 mark. The rand has been volatile in recent weeks, driven by fluctuation in market expectations of US rate hikes and domestic political uncertainty.

Investec economist Annabel Bishop said investor appetite from riskier but high-yielding assets had cushioned the rand from further weakness. Traders are now looking ahead to the medium-term budget policy statement on October 25.

In fixed income, the yield on the benchmark government bond due in 2026 closed up 2.5 basis points at 8.795percent. On the bourse, the benchmark JSE Top40 index fell 0.43percent to 51525.52 points while the all share index lowered 0.44percent to 57896.83 points.

Harmony Gold lost 3.12percent to R22.68 after falling to more than two-month lows early in the session after it said it might consider a rights issue of new stock to repay a loan it will use to finance the purchase of Anglo Gold Ashanti’s Moab Khotsong mine.

- REUTERS