JSE likely to join global rebound, but bad news on SA’s economy is expected
Clues as to whether SA is in a recession will be revealed by mining and manufacturing reports later in the day
The JSE may halt its slide on Thursday, judging from a rebound in Asian markets.
The Shanghai composite index rebounded 2%, Tokyo’s Nikkei 225 index was up 1.26%, and Hong Kong’s Hang Seng index was up 0.71%, with Tencent rising 0.2% to HK$380.20.
Though Sydney’s ASX 200 index was up 0.93%, Thursday may not be a good day for the JSE’s miners. BHP was down 0.7% to A$33.56 and South32 was down 0.8% to A$3.61 ahead of the JSE’s opening.
The rand was trading at R13.54 to the dollar, R15.81 to the euro and R17.87 to the pound at 6.30am.
More clues as to whether SA is in a recession will be revealed at 11.30am when Statistics SA publishes May’s mining production and sales report, and at 1pm with May’s manufacturing production and sales report.
In April, SA’s mining production fell 4.3% after a 8.5% crash in March.
During the first quarter, a 9.9% contraction in the sector mining contributed to SA’s gross domestic product (GDP) shrinking by 2.2% from the previous quarter.
The consensus from a poll of economists by Trading Economics is that the decline in mining production will slow to 3.4% in May from 4.3% in April.
Manufacturing, in contrast, rebounded to 1.1% growth in April after declining 1.6% in March. But it is expected to have fallen 0.6% in May, according to Trading Economics’s consensus.
During the first quarter, manufacturing contracted by 6.4%.