ABN - The resignation of Jacob Zuma and the election of South Africa’s new President Cyril Ramaphosa has resulted in the highest gains amongst South African stocks since June 2016.
News of Zuma’s scandal-hit presidency coming to an end was received positively by the investor market after his successor Ramaphosa promised to fight corruption and spark economic growth.
South Africa's benchmark FTSE/JSE Africa All Share Index rose as much as 2.7%, its biggest gain since June 28 2016, in a boost for dual-listed Johannesburg/London stocks.
The banking sector index made the biggest gains, climbing by up to 4.6% subsequently lifting Standard Bank Group, FirstRand and the Nedbank Group to all-time highs, while the rand rose to a near three-year high against the dollar.
An index of mining stocks also marched up by 3.5% as some investors expected Ramaphosa’s government to review proposed new rules for the industry.
Hopes that a change in leadership will turn around an economy that has averaged just 1.6% growth a year during Zuma’s controversial reign will remain high over the next few months as Ramaphosa establishes his new government.