JSE to contend with weaker Asian markets amid oil jitters
The JSE pushed to a seven-week high on Monday despite a surging oil price, but must contend with market tension over the Middle East
The JSE could struggle to hold on to Monday’s gains on Tuesday, with Asian markets under pressure amid a spiking oil price and concern over rising tension in the Middle East.
The US has told Saudi Arabia it believes Iran was responsible for an attack at the weekend in the kingdom, raising the prospect of a joint military response from the two countries.
“Still, with trade war news winds blowing favourably and a torrent of central bank easing in the offing, barring an Iranian smoking gun in hand, investors don’t appear willing to throw in the equity market towel just yet,” said Vanguard Markets managing partner Stephen Innes in a note.
Markets are still cheered by the prospect of US-China trade talks in October, while a number of global central banks this week could further boost sentiment. The US Federal Reserve is set to announce its latest policy decision on Wednesday; a 25 basis point cut is expected.
At 6.15am on Tuesday the Shanghai Composite had lost 1.02% and Hong Kong’s Hang Seng 1.07%.
Tencent was down 0.63% in Hong Kong, while the rand had weakened 0.3% to R14.702/$.
Gold was flat at $1,498/oz and platinum little changed at $936.89. Brent crude was 0.78% higher at $68.64 a barrel.
Financial services group Sasfin is expected to report later in the day that its full-year headline earnings per share (HEPS) rose by as much as a third in the year to end-June.
Comair, the British Airways franchisee in SA, is expected to report HEPS rose more than 20% in the year to end-June, having received a hefty R1.1bn settlement from SAA due to an anticompetitive incentive scheme for travel agents run by the national carrier. Excluding the effect of the settlement, Comair expects HEPS to fall by more than 20%.