South African assets gain as Middle East peace hopes lift risk sentiment

South African stocks, government bonds and the rand currency strengthened in early trade on Wednesday, 6 May 2026 after US President Donald Trump signalled a possible peace deal with Iran, lifting global risk appetite and boosting demand for emerging market assets.

By Sfundo Parakozov and Nilutpal Timsina

6 May 2026

Source: Reuters.

At 0802 GMT the rand traded at 16.43 against the dollar, up about 1.5% from Tuesday's close.

Trump said that "great progress" had been made towards a comprehensive agreement with Iran and said he would pause an operation to escort ships through the Strait of Hormuz.

The US dollar was last down about 0.3% against a basket of currencies, with oil prices also falling to trade below $110 a barrel on expectations that bottled-up supply
from the Middle East could resume.

South Africa is a net importer of petroleum products and heavily exposed to fluctuations in global energy prices.

"The risk at the moment is asymmetric, and the rand is vulnerable to further adverse developments that could hurt the country's terms of trade
and tilt cross-border flows against the currency," ETM Analytics said in a research note.

A business survey showed on Wednesday that South Africa's private sector expanded at its fastest
in nearly four years in April.

On the Johannesburg Stock Exchange, the Top-40 index was up 2.5%.

South Africa's benchmark 2035 government bond also firmed in early deals, with the yield down 14 basis points at 8.71%.

Source: Reuters

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