Fallout from Huawei CFO arrest likely to knock JSE
Naspers’s Tencent fell 4% on Thursday morning, joining a Chinese tech rout sparked by the arrest in Canada of Huawei’s CFO Meng Wanzhou
Asian markets were rattled on Thursday morning by the arrest in Canada of an executive of Chinese telecoms equipment manufacturer Huawei.
Meng Wanzhou, the daughter of Huawei’s founder Ren Zhengfei and who serves as the group’s CFO and deputy chair, will be extradited to the US where she faces charges of violating sanctions against Iran.
Tencent was among the Chinese technology stocks to suffer on Thursday morning, losing 3.61% to HK$309.40.
Naspers tends to track Tencent because its 31%-stake in the Hong Kong-listed internet company is its major asset, so the JSE top 40’s largest constituent is likely to add to Wednesday’s 2% drop to R2,872.62.
Tencent contributed to Hong Kong’s Hang Seng index falling 2.6%.
Huawei’s products are widely used and sold in SA.
In Sydney, the JSE top 40’s second-largest constituent, BHP, was down 2% to A$31.18, a bad omen for the local bourse on Thursday.
The price of palladium, which overtook platinum in 2017, has now also overtaken gold.
All these precious metals are available to JSE investors in a variety of exchange-traded funds (ETF) and exchange-traded notes.
Absa’s NewGold-branded palladium ETF has appreciated 28% over the past year, whereas its platinum ETF has suffered an annual decline of 11% while its gold ETF is nearly where it was a year ago at R161.
Palladium, however, has not done as well as its sister platinum group metal rhodium. Standard Bank’s rhodium ETF looks to be 2018’s best-performing exchange-traded product, with an annual gain of 69% at time of writing.
The rand was weaker at R13.94/$, R15.81/€ and R17.74/£ at 7am.