An element of caution is expected on global markets on Wednesday, and trading on the JSE may be slightly subdued ahead of the US Federal Reserve policy announcement.

The Fed is widely expected to cut interest rates by 25 basis points after local markets close, and the forward guidance from the world’s most influential central bank will be closely scrutinised.

Further easing in trade tension between the US and China as well as positive data from the former have tempered the bias for a cut by the Fed, which put a little pressure on the rand on Tuesday, said Peregrine Treasury Solutions corporate treasury manager Bianca Botes in a note.

Asian markets were relatively flat on Wednesday morning, although Shanghai’s Composite was up 0.39% as of 6.20am. Tencent was down 0.12% in Hong Kong, while the rand was flat at R14.7031/$.

Gold and platinum were flat at $1,502/oz and $940.85 respectively.

Brent crude had added 0.59% to $64.37 a barrel, although it had slipped 5.39% on Tuesday. This followed a 13.15% rise on Monday.

Focus also remains on the Middle East, following an attack on Saudi Arabian oil production at the weekend. The prospect of a strike against Iran, which is being blamed for the attack by the US, has eroded sentiment a little.

Pan African Resources is expected to report later that headline earnings per share (HEPS) rose as much as 134% for the year to end-June, having suffered a hefty impairment related to its Evander Mine in the year-earlier period.

Capital equipment and engineering services group ELB’s share price should react to its full-year results to end-June on Wednesday. The company reported it had swung into a loss of R32.4m, opting not to pay a dividend.


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