S.Africa's rand firmer, stocks up on mining shares

South Africa's rand firmed against the dollar on Thursday as the greenback lost a bit of ground while the bourse ended higher on mining shares' gains.

A break of 7.00/dollar will confirm a bullish trend for the rand, but for now, it's unlikely because strong importer interest in the low 7.00's is limiting the currency's gains.

The central bank has been very active in the market in an effort to keep a lid on its gains, dealers said.

By 1534 GMT, it was trading at 7.0350 to the dollar, 0.46 percent firmer than Wednesday's New York close of 7.06.

We continue to take direction from abroad. The dollar wobbled a bit and that took the rand to the 7.03 area but it's seeing good buying interest there, said a dealer.

The rand has strong support at 7.10 but that level has proven tough to break in the past few sessions.

If the euro comes off, the people will take risk off the table and then we'll see the rand break 7.10.

Reaction was rather muted to local data showing growth in factory gate prices slowed a little more than expected to 5.8 percent year-on-year in December compared with 6.2 percent in November.

The market has started to price in a possibility of a rate increase towards year-end partly on expectations that inflation might start to pick up due to some extent to base effects.

Government bonds weakened, with the yield on the 2015 issue up 1.5 basis points to 7.775 percent and that on the 2026 paper rising 3.5 basis points to 8.635 percent.

On the bourse, the JSE Top-40 index of blue chips added 0.58 percent to 28,812.99, while the broader All-share index gained 0.54 percent to 32,138.54.

A flattish day in the rest of the market, but Anglo American and BHP Billiton are still driving us and keeping our market positive Wilmar Buys, a trader at FFO Securities said.

Bourse and mining heavyweight Anglo American rose 0.99 percent to 356.51 rand and BHP Billiton increased 0.64 percent to 277.28 rand.

Merafe Resources was up 1.94 percent to 1.58 rand after the South Africa's largest producer of ferrochrome said it expects to return to full-year profit.

Aquarius Platinum rose 3.29 percent to 40.53 rand in Johannesburg after the world's fourth-largest primary platinum producer said its second quarter output increased by 3 percent quarter-on-quarter and by 14 pe