UPDATE 1-Power cuts, weak data hold back South African rand

(Recasts, updates prices, adds stocks)

JOHANNESBURG, Jan 9 (Reuters) - The South African rand weakened slightly against the dollar on Thursday, as power cuts, weak manufacturing data and a trimmed World Bank growth forecast weighed.

The currency had steadied against the dollar earlier in the day as fears of a fresh conflict in the Middle East following the killing of Tehran’s top general in a U.S. drone strike abated.

At 1510 GMT, the rand traded at 14.2130 per dollar, 0.26% weaker than its previous close.

Wichard Cilliers, chief currency dealer at TreasuryOne, said easing tension in the Middle East was the main factor driving the currency market, but disappointing local news hurt the rand’s ability to capitalise on positive sentiment.

“It’s all lingering in the background, though it’s not helping to strengthen too much,” he said.

South Africa’s troubled state power utility Eskom said it would extend power cuts until Friday morning, the latest round of blackouts that have hurt the continent’s most industrialised economy.

The World Bank cited concerns over electricity supply as its reason for trimming the country’s growth forecast to 0.9% in 2020.

Statistics South Africa said manufacturing output contracted by 3.6% year-on-year in November. Cilliers said this had been expected, so its impact on the rand was not significant.

In fixed income, the yield on the benchmark government bond due in 2026 fell 1 basis point to 8.24%.

Stocks closed weaker, with the Johannesburg Stock Exchange’s Top-40 index down 0.34% to 50,916 and the broader all-share index down by the same amount to 57,129 points.

Gold producers like Goldfields, Anglo American Platinum and Sibanye-Stillwater lost some of the gains made in the past week as investors flocked to safe haven assets amid heightened tension between the United States and Iran. Goldfields, the biggest loser on the blue-chip index, dropped 4.3%.

At the other end were a number of financial firms and retailers that benefit from a stronger rand. (Reporting by Olivia Kumwenda-Mtambo, Kara van der Berg and Emma Rumney; Editing by Shailesh Kuber and Susan Fenton)