The rand weakened as a recent rally gave way to a resurgent dollar boosted by climbing US treasury yields. File image: IOL

JOHANNESBURG - South Africa’s rand weakened on Monday as a recent rally gave way to a resurgent dollar boosted by climbing US treasury yields and a dip in risk demand, as trade war concerns resurfaced.

Stocks began the week marginally higher, buoyed by general retailers.

At 07:00 GMT the rand was at 14.27 per dollar, having traded as firm as 14.0675 yesterday in the session before dollar bulls came online in New York and were lured into long positions.

In late trade yesterday, the greenback was up 0.2 percent against a group of major currencies. A poor purchasing managers’ index print also put the skids on the rand as worries about the economy after its recent slide into recession kept buyers on the sidelines.

South Africa’s seasonally adjusted Absa Purchasing Managers’ Index (PMI) fell slightly in September, to 43.2 from 43.4 in August, a 14-month low.

Bonds were weaker, with the yield on the benchmark government bond due in 2026 rising 2 basis points to 9.045 percent.

On the bourse, the blue chip top 40 index was 0.13 percent higher at 49,587 points and the all share index was 0.15 percent firmer at 55,789 points.

Aspen Pharmacare rose 3.1 percent, a slight recovery from its share price tumble of more than 35 percent last month after it posted full-year results and announced the baby milk disposal to French dairy group Lactalis.

“I did say it was probably overdone and the market reacted a bit harshly. It is still down 40 percent in the last month so it’s hardly a bounceback,” said Ricco Friedrich, portfolio manager at Denker Capital.

-REUTERS