Old Mutual, Investec dive after South Africa's Zuma fires finance minister Gordhan

Shares in South African stocks including Old Mutual and Investec dived after the country's president, Jacob Zuma, fired finance minister Pravin Gordhan in a midnight cabinet reshuffle on Thursday night, sending the rand and government bonds tumbling.

Zuma's reshuffle involved eight other ministers. Zuma said in a statement that his midnight action was about a "radical socio-economic transformation".

Gordhan was replaced by Malusi Gigaba as finance minister, previously the minister of home affairs.

The new deputy finance minister was now Sfiso Buthelezi, replacing Mcebisi Jonas.

The South African rand, which had begun to tumble over the weekend as rumours, confirmed on Monday, emerged that Zuma had recalled Gordhan from an investment conference in London, fell a further 0.6% against the pound to a six-week low of 16.6506, and 0.44% on the US dollar to 13.3417.

Old Mutual led the FTSE 100 fallers, noted Neil Wilson, senior market analyst at ETX Capital, "as markets reacted to developments with concern".

"Mondi and Anglo American were also in the top 5 fallers on the FTSE in early trading as the market felt the Gordhan effect," said Wilson, who noted that miners were also off colour due to softer metal prices.

At about 10:51 GMT, shares in FTSE 100-quoted Old Mutual were down 6.22% to 203.4p each. Mondi dropped 2.23% to 1933p, and Anglo American fell 3.37% to 1220p. Investec was down 9.77% to 545p.

The opposition party in South Africa’s parliament has said that it will attempt to remove Zuma from office with a vote, and asked for the support of the other main parties.

"We therefore urge all political parties, including members of the ANC, to vote President Jacob Zuma out when [our] motion of no confidence is debated in the National Assembly," said Mmusi Maimane, leader of the Democratic Alliance.