Metal prices drive South African stocks higher; rand rises

South African Rand coins are seen in this illustration picture. REUTERS/Mike Hutchings/Illustration

JOHANNESBURG (Reuters) – South African stocks and the rand strengthened on Tuesday after the resources index jumped on the back of higher platinum group metals (PGM) prices.

On the Johannesburg Stock Exchange, the blue-chip Top-40 index closed up 0.88%, while the broader all-share index ended 0.73% higher.

The resources index, which jumped over 4% from its previous close, drove the market’s gains as platinum and palladium prices rose more than 3%.

Commodities prices hit low levels in March and have been rising since then, Wayne McCurrie, an FNB portfolio manager, said.

Impala Platinum’s stock also rose after announcing it would buy more shares in Royal Bafokeng Platinum, strengthening its hold on a miner with high-grade assets that made it an attractive takeover target.

Impala was going head-to-head with rival Northam Platinum in a bidding war for Royal Bafokeng before Northam pulled out earlier this month.

At 1610 GMT, the rand traded at 18.1925 against the U.S. currency, 0.67% firmer than its previous close.

On Wednesday, investors will turn their focus to the March consumer price index, which could affect whether the South African Reserve Bank hikes interest rates again in May.

The government’s benchmark 2030 bond was flat at 10.050%.

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