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(Updates prices)
JOHANNESBURG, May 8 (Reuters) - South Africa’s rand firmed on Friday, with sentiment toward risk and emerging market currencies boosted by an easing in tensions between China and the United States and optimism about the re-opening of some economies around the world.
The Johannesburg Stock Exchange (JSE) ended the week on a strong note backed by higher spot gold prices and the general positive sentiment.
At 1520 GMT the rand was 1.32% firmer at 18.3450, extending the gains that saw it rise more than 2% this week.
“Risk appetite is getting a boost after the US and China committed to the implementation of the phase one trade deal that was signed in January,” Han Tan, market analyst at FXTM, wrote in a note.
“The last thing global investors need right now amid the global coronavirus pandemic is a one-two punch from spiking trade war risks.”
Top U.S. and Chinese trade representatives discussed the Phase 1 trade deal on Friday, with China saying they agreed to improve the atmosphere for its implementation and the United States saying both sides expected obligations to be met.
Investors had been fretting over the potential fallout from yet another escalation in tensions between the world’s two biggest economies at a time when countries are struggling with the economic havoc wrought by the new coronavirus pandemic.
The FTSE/JSE all share index closed 1.97% up at 51,004 points and the JSE Top 40 index rose 2.09% to close at 47,062 points.
The market rally was driven by higher spot gold prices which lifted the JSE gold index almost 5% when the stock market closed for trading on Friday.
Bonds also gained, with the yield on the benchmark 2030 government issue down 15.5 basis points to 9.29%.
