JSE is weaker on Moody’s jitters, while lower oil price spooks global markets
The JSE all share opened weaker on Wednesday as the lower oil price spooked global markets and as investors eyed ratings agency Moody’s looming announcement on SA’s creditworthiness. The market has largely priced in a one-notch downgrade from Moody’s in the local and foreign currency ratings from Baa2 to Baa3. The big question is if they will go further and downgrade SA by two notches, and keep the outlook negative. Currently the expectation is that Moody’s will change the outlook to stable. Rand Merchant Bank analyst John Cairns said it was highly unlikely Moody’s would announce a two-notch downgrade. "But markets could be impacted adversely if a negative outlook is assigned." Moody’s is expected to make its announcement on either June 2 or June 9. S&P Global Ratings is set to provide an updated assessment on SA on Friday, after downgrading the country to junk status in April. The jittery market is an indication that the ANC’s reluctance to recall President Jacob Zuma remains a ris...
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