JSE could open lower as Hong Kong protests weigh on Asian stocks
The JSE could open lower on Tuesday as the Asian markets’ recovery from last week’s sell-off was short-lived as Hong Kong protests and concerns about the US-China trade war weighed on sentiment.
Hong Kong chief executive Carrie Lam on Tuesday raised concern about the violence that has engulfed the city in the past week as pro-democracy protests intensified. Lam said it may take a long time for the city to return to normality after the Hong Kong Airport cancelled flights on Monday due to protest action.
Investors are closely watching any developments in the protracted US-China trade war after US President Donald Trump said it was at unlikely that the two countries will soon reach a deal.
The Shanghai Composite earlier lost 0.74%, Hong Kong’s Hang Seng 1.86% and Japan’s Nikkei 225 1.20%.
Naspers’ Hong Kong-listed subsidiary and Chinese technology company Tencent had fallen 1.29%.
The rand remained at 11-month lows against the dollar amid growing worries about Eskom and SA’s credit rating. On Tuesday, the rand opened at R15.28/$. R17.15/€ and R18.47/£.
“The recovery in the rand in the overnight session confirms the notion that the rand is oversold, however the uncertainty in global markets is doing little to assist a meaningful run by the local unit,” treasury partner at Peregrine Treasury Solutions Bianca Botes said in a note.
No major domestic economic data is expected on Tuesday. Steinhoff is expected to update investors on its restructuring plan later in the day.