Rand, banking stocks rally as new finance minister announced

The pickup comes after President Cyril Ramaphosa appointed former central bank governor Tito Mboweni as finance minister, a move that soothed markets after days of uncertainty.At 1622 GMT the rand was 1.24% firmer at 14.6825, a touch softer than the session best of 14.6525 after the decision.Bank stocks rose 1.19% , as investors welcomed Mboweni’s appointment that eased a week of uncertainty.Ramaphosa said he received and accepted Nhlanhla Nene’s resignation as finance minister on Tuesday.Nene faced calls to resign after he admitted visiting the Gupta brothers, friends of scandal-plagued former president Jacob Zuma who have been accused of high-level influence-peddling, and failing to disclose the meetings earlier. Zuma and the Guptas have denied any wrongdoing.Bonds were also firmer, with the yield on the benchmark paper due in 2026 down 4 basis points 9.22%.“Tito brings strength to the position. He is not afraid to go up against other ministers and he also understands the importance of fiscal consolidation which is crucial at this moment,” said Nazmeera Moola of Investec.Moody’s, the last of the top three rating agencies to have Pretoria’s debt at investment grade, is set to release its latest review on Friday.In the equities market, the Johannesburg all-share index and the Top-40 index struggled to hold on to gains registered immediately after the appointment of Mboweni, despite the rally by banking stocks.The All-share inched 0.06% lower to 54,187 points and the blue-chip ended the session 0.15% weaker at 47,970 points.First Rand gained 1.95% to 62.09 rand, while Absa Group rose 1.54% to 148.61 rand. Capitec Bank Holdings firmed 1.44% at 991.38 rand.“The investor community is sad to see minister Nene go but they are also very happy to see Tito Mboweni come in because he is well known and well respected in the investment community,” FNB Wealth portfolio manager, Wayne McCurrie said.“The state president has shown that he will act against any indiscretion that impairs the integrity of his appointees in cabinet,” he said.-Nampa/Reuters

Rand, banking stocks rally as new finance minister announced

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