JSE faces mixed Asian markets on Monday as investors eye US policy

The JSE looks set to open to mixed Asian markets on Monday morning, with investors weighing some disappointing data out of China, while there are still questions about the future of US monetary policy and the economic fallout from the Delta variant.

In the US, the Dow Jones Index and S&P 500 ended Friday on record highs, but this followed a week of mixed economic data, and the US, with countries including Indonesia and Australia, are grappling with rising Covid-19 numbers.

On Monday markets were reacting to news that retail sales rose 8.5% in China in July, well below expectations, while investors will also be looking for clues about US monetary policy later this week when the minutes from the US Federal Reserve’s latest meeting will be released.

The market is still trying to gauge when the world’s most influential central bank will start tapering its stimulus programme and tighten rates amid attempts to get massive fiscal stimulus bills through the US Congress.

In morning trade the Shanghai Composite was up 0.37%, while the Hang Seng gave back 0.74% and Japan’s Nikkei 1.85%.

Tencent, which can give direction to the local bourse via the Naspers stable, fell 3.19%. 

Gold was trading 0.18% lower at $1,776.24/oz while platinum  fell 1.05% to $1,019.19. Brent crude was 0.44% lower at $69.90.

The week ahead is somewhat busy for local corporate releases, with Absa set to report on its results for the six months to end-June later. The group has said in a trading update headline earnings per share would more than double.

A number of banks have reported lower-than-expected credit impairments and robust retail demand for credit as SA’s economy recovers.

Chemical and energy group Sasol is due to report a sharp recovery and a return to headline profit for its year to end-June later. Sasol has benefited in 2021 from rising fuel prices, but has also said its cost-cutting efforts have paid off.

gernetzkyk@businesslive.co.za