South African political parties that support a broad alliance to form the next government agreed to back the reelection of Cyril Ramaphosa as president.

“We have agreed to cooperate on the president and the national and provincial legislatures,” Fikile Mbalula, the secretary-general of the African National Congress (ANC), said in interview in Cape Town Friday. A framework for a new government of national unity is still being worked out, and “the situation is still very fluid,” he said.

The centrist Democratic Alliance (DA) and the smaller Inkatha Freedom Party (IFP) and Patriotic Alliance have indicated their intention to join the new administration.

Stocks Rally

Investors took heart from the signal of pro-growth policy continuity implied by the choice, driving the Johannesburg Stock Exchange as much as 1.6% higher as the rand hovered around 18.42 per dollar. The yield on benchmark 2035 government bonds fell two basis points to 11.66%, the lowest in almost four months.

The ANC’s Thoko Didiza will become the speaker of the National Assembly, while the deputy position will go to the DA’s Annelie Lotriet, according to people familiar with the negotiations who asked not to be identified because the talks are private. Despite the agreement, nothing is in writing — a key demand of the DA for it to join the new administration.

Parliament began its first sitting on Friday since elections last month failed to produce an outright winner, meaning the ANC will have to partner with one or more rivals if it wants to retain power.

Shortly after legislators began sitting, South Africa’s presidency tweeted a picture of Ramaphosa with two thumbs up and the hashtag #ontrack.

The ANC, which has held power since apartheid ended in 1994, invited all the country’s main parties to join a broad alliance to form the next administration in a so-called government of national unity.

Former President Jacob Zuma’s uMkhonto weSizwe Party, or MKP, and the Economic Freedom Fighters — both favour land expropriation and the nationalization of mines and banks — however declined to participate.

The ANC has 159 of the 400 seats in the National Assembly, the DA 87, the MKP 58, the EFF 39, the IFP 17 and the PA nine.

The EFF said it won’t be part of any administration that includes the DA. But it would agree to back Ramaphosa’s reelection in return for the ANC supporting the appointment of its chairperson, Veronica Mente, as speaker of the National Assembly, its leader Julius Malema told reporters in Cape Town on Thursday. That offer now appears redundant.

The MKP alleged that the election was rigged, but the nation’s top court on Wednesday dismissed its application to stop parliament from convening. The party’s lawmakers boycotted Friday’s sitting.

Zuma, who led the country for almost nine scandal-marred years before the ANC forced him from office, was ruled ineligible to stand for a seat because he was convicted of contempt for refusing to testify before a judicial graft inquiry.