JSE to contend with mixed Asian markets on Friday as Covid-19 jitters take hold

The JSE looks set to contend with mixed Asian markets on Friday morning, but will be coming off its worst day in nine months on Thursday, with rising Covid-19 numbers in parts of the world posing a renewed threat to global growth prospects.

US markets were under pressure on Thursday, when the local bourse gave back 2.34%.

“A month ago, everyone was thinking the US economy could grow between 8%-10%, now that has come down closer to 6%,” Oanda senior market analyst Edward Moya said in a note.

The outlook for growth has deteriorated amid news that the Olympics in Tokyo will occur without fans and that the US is not any closer to lifting restrictions on international travel, he said. Japan has declared a state of emergency as it grapples with a spike in infections.

In morning trade on Friday the Shanghai Composite was down 0.79% and Japan’s Nikkei 1.79%, while the Hang Seng had gained 0.65%.

Tencent, which can give direction to the JSE via the Naspers stable, added 1.8%, after falling 3.74% on Thursday.

Gold was flat at $1,802.39/oz while platinum rose 0.21% to $1,076.80. Brent crude fell 0.24% to $74.16 a barrel.

The rand was 0.11% weaker at R14.35/$.

The local corporate and economic calendar is bare on Friday, but Prosus shareholders are set to vote later on a share-swap transaction aimed at reducing the discount at which Naspers trades.

In terms of the transaction, Prosus, which listed in Amsterdam in 2019 as part of the previous attempt to deal with the valuation problem, will issue new shares in exchange for a stake of about 45% in its parent. The complex transaction has sparked criticism from a number of investors.

gernetzky@businesslive.co.za