JOHANNESBURG, Feb 22 (Reuters) - South African bond yields spiked on Wednesday before easing back after Finance Minister Pravin Gordhan targeted the wealthy with tax hikes, underscoring the challenge of boosting revenues to plug the budget gap.
The benchmark 2016 issue bond softened while Gordhan spoke, with the yield rising 6 basis points at one point ti 8.79 percent. At 1520 GMT it had recovered a bit to 8.765 percent.
"While borrowing requirements are not substantially changed, the overall mix of measures, even with further attempts to cut spending, will do very little to boost confidence," said Razia Khan, Standard Chartered Bank's Chief Africa Economist.
The rand was little changed, holding onto earlier gains to trade 0.35 percent higher at 13.0950/dlr at 1530 GMT.
On the bourse, mining shares were under pressure on faltering commodity prices with AngloGold Ashanti topping the decliners list on the benchmark index.
The blue-chip JSE Top-40 index ended 1.06 percent lower at 45,073 and the broader All-share index index was down 0.95 percent at 52,088.
AngloGold Ashanti dropped 4.3 percent to 160.20 rand, weighed down by 'sell" rating downgrade from several brokers that include those at Citigroup and stalling momentum in the price of gold.
However, rival Sibanye Gold inched up 0.3 percent to 28.06 rand after the company flagged a more than three-fold surge in annual profit.
Elsewhere, Murray & Roberts was flat at 15 rand after Germany's ATM Holding said it had bought 25 percent stake in the construction firm, igniting speculation that it might looking for a tie-up with the South African company. (Reporting by Tiisetso Motsoeneng and Ed Stoddard)