South African rand, stocks weaken on talk of cabinet reshuffle

South Africa’s rand was on course for its third straight session of losses on Monday as reports that President Jacob Zuma is considering a cabinet reshuffle weighed on sentiment.

At 0825, the local unit traded 1.34 percent weaker against the dollar at 13.6175, a level last seen a week ago.

Government bonds also weakened. The yield on the benchmark bond maturing in 2026 rose 10 basis points to 8.95 percent.

“Risk sentiment is taking a bit of a knock following the latest political developments on possible cabinet reshuffle on the domestic front,” Jana van Deventer, a trader at ETM said.

The rand weakened on Friday, hurt by media reports, citing unnamed leaders of the ruling African National Congress (ANC), that Zuma could remove ministers who backed calls for his resignation in November.

The ANC is due to hold a news conference at 1200 GMT to discuss the outcome of a regular meeting of its top leaders.

On the bourse, banks were among the biggest decliners on the benchmark Top-40 index, which fell 0.5 percent tracking oversees markets as commodity prices dipped. Standard Bank and rival FirstRand each fell 1.8 percent.