JSE faces mixed Asian markets on Tuesday amid growth concerns

The JSE looks set to start to a mixed Asian session on Tuesday morning, with some caution prevailing as investors consider waning global growth prospects.

Chinese GDP data on Monday beat expectations, but retail sales disappointed and continued lockdowns in the country have raised concerns about a slowdown.

The melding of higher global yields and downside risks to China’s activity signals that fixed-income investors anticipate supply-side disruption that adds to elevated global inflation expectations, said SPI Asset Management managing partner Stephen Innes in a note.

“With labour markets tight across developed countries, monetary policy should remain firmly hawkish,” Innes said.

The World Bank on Monday also lowered its estimate for global growth in 2022 to 3.2% from a January prediction of 4.1%, amid pressure on the outlook for Europe and central Asia that includes Russia and Ukraine, and general uncertainty.

World Bank chief economist Carmen Reinhart said the global economy is passing through a period of “exceptional uncertainty” and added that she would not rule out further downgrades to the growth outlook, Bloomberg reported.

Global attention is on US earnings this week, while locally a state of disaster has been declared in the Eastern Cape and KwaZulu-Natal after devastating floods killed more than 400 people and caused damage costing billions of rand.

Stage 2 load-shedding also continues on Tuesday.

In morning trade the Hang Seng fell 1.83%, while Japan’s Nikkei fell 0.63% and the Shanghai Composite 0.12%.

Tencent, which influences the JSE via the Naspers stable, fell 2.62%.

Gold was flat at $1,977.53/oz, while platinum rose 0.86% to $1,019.63. Brent crude was 0.77% higher at $112.72 a barrel.

The rand was 0.18% weaker at R14.68/$.

The local corporate and economic calendar is bare on Tuesday.

gernetzkyk@businesslive.co.za