S.Africa's rand retreats as Fed hike bets resurface, stocks up

JOHANNESBURG (Reuters) - South Africa's rand weakened for second straight session on Friday as increased bets of an interest rate hike in the United States dampened demand for emerging currencies globally. Stocks gained amid a mixed market led by investors buying back into the resources sector By 1615 GMT the rand had slipped 0.7 percent to 14.0375 per dollar, its weakest since Tuesday, following a rally to one-week highs on reduced concerns over the future of the finance minister. The unit lost around 4 percent against the dollar on Oct. 11 when state prosecutors announced fraud charges against Finance Minister Pravin Gordhan for firing his deputy at the revenue service and then rehiring him as consultant. Gordhan, due to deliver his mid-term budget before parliament next week, has called the charges "frivolous", and this week was backed by the deputy president as well as business leaders, lifting the rand. "The local political noise has subsided somewhat but remains in the background with people now being much more alert to any sudden announcements or developments," currency trader at Standard Bank Oliver Alwar said in a note. The rand has given up its gains from earlier this week as hawkish comments by a Federal Reserve member and Donald Trump's failure to register a big win in the final presidential debate hardened the view that the bank will lift lending rates at its December meeting. Government bonds were weaker, with the benchmark paper due in 2026 adding 4 basis points to 8.83 percent. On the bourse, the benchmark Top-40 index rose 0.45 percent to 45,069 points while the All-Share index firmed 0.41 percent to 51,629 points. Resource shares saw some buying return in mixed trade as investor confidence crept back into mining companies. "A lot of the mines are starting to show signs of life again. They seem to be fairly stable after a rough period and they are starting to produce decent results," said Independent Securities trader Ryan Woods. Anglo American plc rose 4.49 percent to 187.02 rand, Sibanye Gold gained 2.72 percent to 43.48 rand and AngloGold Ashanti firmed 1.52 percent to 197.45 rand. Further gains were curbed by MTN which fell 0.47 percent to 107.00 rand amid nervousness over allegations that the telecommunications firm broke Nigeria currency transfer rules. The company says it has complied. Trading was slow, 210 million shares changing hands compared with last year's daily average of 280 million. (Reporting by Mfuneko Toyana and Tanisha Heiberg; Editing by Ed Stoddard)