JSE to contend with muted Asian markets on Thursday as rand hovers near R16/$

The JSE looks set to open to a mixed picture for Asian markets on Thursday morning, while the rand was steady after approaching R16/$ on Wednesday.

Minutes from the US Federal Reserve’s most recent policy meeting indicated that officials were ready to act should inflation persist, while there were some policymakers who have adopted a more hawkish tone.

Some US economic data was also strong overnight, including data showing that consumer spending remained upbeat, while core personal consumption expenditures — the Fed’s preferred inflation measure — came in as expected at 4.1% year on year in October. This core measure excludes food and energy, 

Energy prices increased 30.2% year on year, while food prices increased 4.8%, the data showed.

“The US economy retained its titanium status overnight with a slew of better than expected data pointing to a re-acceleration in growth in the fourth quarter,” National Australia Bank analyst Tapas Strickland said in a note. Notably US jobless claims fell to their lowest level since November 1969 and though seasonal factors likely exaggerated the fall, the overall message is still the same, he said.

This helped boost the dollar, with the rand touching R15.97/$ on Wednesday, while in morning trade on Thursday the local currency was little changed at R15.86/$.

In morning trade, the Shanghai Composite was down 0.1%, while the Hang Seng had added 0.17%, and Japan’s Nikkei 0.78%. 

Tencent, which can give direction to the JSE via Naspers, had gained 1.86%.

Gold was up 0.23% to $1,792.53/oz, while platinum had gained 1.23% to $987. Brent crude was 0.1% higher at $82.29 a barrel.

Local focus on Thursday is on worrying Covid-19 numbers, with daily cases rising to 1,000 in Gauteng this week, prompting concerns that the fourth wave is on its way.

Agriculture-focused Kaap Agri is due to release its results for the year to end-September later, and is involved in one of the few sectors of SA’s economy that have grown significantly during Covid-19, lifted by buoyant commodity prices and favourable rainfall patterns in SA.

Christo Wiese-chaired industrial holding company Invicta is due to release its results for the six months to end-September later, and will include a boost from profits on recent disposals and positive fair-value adjustments. The group, which had been grappling with a hefty tax settlement issue in recent years, halved its debt and more than doubled cash generation in the year to end-March, putting it back on the acquisition path.

Retailer Mr Price is due to release its half-year results to October 2 later, saying in a recent trading update that headline earnings per share are expected to rise as much as 40%, with hard lockdowns in the prior period having affected trading.

gernetzkyk@businesslive.co.za