JOHANNESBURG: South Africa's rand gained on Monday after Moody's delayed its credit rating decision while Chinese stocks, boosted by positive manufacturing data, helped lift local shares.

Markets had been on edge on Friday over the impending ratings review, with many analysts expecting Moody's to cut Pretoria's debt to "junk status" from Baa3 in the wake of power-utility Eskom's nationwide rolling blackouts.

Such a downgrade would likely mean an outflow of billions of dollars, with big pension funds and other investors forced to sell their South African bonds.

At 1650 GMT the rand had strengthened 2.14 percent to 14.2000 to the dollar, its firmest level since March 22.

"Their sense of relief from Moody's decision to delay an update on the nation's credit rating is also helping sentiment," said FXTM research analyst Lukman Otunuga in a note.

The Johannesburg Stock Exchange (JSE) ended higher, with the Top-40 rising by 1.2 percent while the wider All-share index rose 1.15 percent.

Bank shares led the way with the banking index up 3.73 percent, with ABSA climbing 4.54 percent to 159.00 rand, FirstRand gained 2.92 percent to 64.80 and Standard Bank closed up 4.48 percent to 193.53 rand.

"Moody's not downgrading meant that money that was waiting on the side line is now flowing into the market ... when foreign investors come in, they go for [banking stocks] the most," Greg Davies, head of wealth at Cratos Capital, said.

Bond prices also rose, with the yield on the benchmark 10-year bond dipping 2.5 basis points to 8.47 percent.