JSE likely to head higher ahead of crucial US jobs report
Economists expect the US to have added 500,000 jobs in September
The JSE is likely to move higher on Friday, with the recovery in commodity prices set to boost mining shares.
Asian markets were broadly higher, taking their lead from a positive finish on Wall Street on Thursday night.
The rand slipped in early trade, as US treasury yields rose, boosting the value of the dollar ahead of the release of the US nonfarm payrolls report in the afternoon.
The world’s largest economy is expected to have added 500,000 jobs in September, according to Reuters’ survey of economists, up from 235,000 in August.
The stronger jobs report is seen as crucial in determining the timeline for the US Federal Reserve in scaling back its huge bond buying programme, which has been a key pillar of support for risk assets over the past 18 months of the Covid-19 pandemic.
Markets are also increasingly concerned about global inflation becoming embedded, given the rising oil prices and protracted global supply chain disruptions.
Brent crude scaled to a fresh three-year high at $83 a barrel while the benchmark US 10-year treasury yield rose to its highest level since June at about 1.59%.
The rising US treasury yield could detract capital from high-yielding yet riskier assets in emerging markets.
“All roads lead ... [to] US non-farm payrolls data which will decide, in the market’s minds, whether the start of the Fed taper is a done deal for December,” said Jeffery Halley, senior market analyst at Oanda
“The volatile ranges seen this week across asset classes suggest that is so except for energy. I do not believe that markets have priced in the Fed taper and its implications to any large degree yet.”
The rand fell 0.37% to R14.9798/$ while palladium fell 0.36% to $1,953.50/oz.
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