The JSE faces subdued Asian markets on Wednesday morning, with sentiment under pressure from the fading hope of US stimulus, along with muted corporate earnings from that country.

US corporate earnings reports on Tuesday were a mixed bag, while the stalemate between political parties in the world’s largest economy over a second round of stimulus measures shows no sign of ending.

Drugmaker Johnson & Johnson has also delayed trials for a Covid-19 vaccine.

The hope that a stimulus package will be agreed in coming days is dimming, according to National Australia Bank analyst Rodrigro Catril.

It is now a three-way negotiation, between the White House and both political parties in Congress, given that Senate Republicans continue to push for a smaller spending plan, he said in a note.

“So for now it is hard to see a deal being agreed before November 3, the market is still travelling with the notion that a new round of stimulus is coming, but at this stage this looks more likely after the election,” said Catril.

In morning trade the Shanghai Composite was down 0.5% while the Hang Seng had lost 0.27%.

Tencent, which often gives direction to the JSE via its largest single shareholder Naspers, had added 2.24%.

Gold was up 0.41% to $1,897.09/oz while platinum had risen 1.3% to $873.36. Brent crude was 0.21% weaker at $42.41 a barrel.

The rand was flat at R16.44/$.

Locally there is little on the local corporate calendar on Wednesday, while retail sales numbers for August are due later.


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