The JSE could be in store for further losses on Thursday morning, with the rand at a record-low ahead of the Reserve Bank's interest rate decision later.

Globally, central banks are responding to the coronavirus outbreak through stimulus, but a weaker rand could push up the price of SA exports, and fuel inflation.

Investors continue to sell off riskier assets, with the tech-heavy US Nasdaq falling more than 4% on Wednesday.

Investors are hoarding cash, Oanda senior market analyst Jeffrey Halley said in a note, while yields on short-term US treasuries had fallen close to zero, even as yields on longer-term debt have risen considerably. Bond yields move inversely to bond prices.

“Unfortunately, I suspect that capitulation trade will be a multi-day one, with the end result being markets trading sideways at their lows for an extended period,” Halley said.

In morning trade on Thursday, the Shanghai Composite was down 2.14% and the Hang Seng 4.25%.

Tencent had fallen 0.96%, pointing to possible weakness for the Naspers stable.

The rand was 1.64% weaker at R17.45/$, having earlier fallen to as much as R17.49. The local currency has now lost almost a quarter of its value so far in 2020.

Gold was 1.37% weaker at $1,465.69/oz while platinum had lost 1.36% to $611.25. Brent crude was flat at $25.30 a barrel, having fallen 12% on Wednesday.

Locally, all eyes will be on the Reserve Bank, which is expected to follow its global counterparts in cutting interest rates.

The Bank is likely to implement a 50 basis point cut to assist the economy in the wake of the coronavirus outbreak, Peregrine Treasury Solutions treasury partner Bianca Botes said in a note.


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