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The refurbished Hong Kong Stock Exchange in Hong Kong, China, on June 24 2022. Picture: BERTHA WANG/BLOOMBERG
The refurbished Hong Kong Stock Exchange in Hong Kong, China, on June 24 2022. Picture: BERTHA WANG/BLOOMBERG

The JSE looks set to open to a mixed Asian session on Thursday morning, amid some hawkish commentary from central bankers, as well as mixed news out of China.

China’s factory and service sectors snapped three months of activity decline in June as authorities lifted a strict Covid-19  lockdown in Shanghai, reviving output and consumer spending, Reuters reported.

The official manufacturing purchasing managers’ index (PMI) rose to 50.2 in June from 49.6 in May, the National Bureau of Statistics (NBS) said. That slightly missed the forecast for 50.5 in a Reuters poll but rose above the 50-point mark that separates contraction from growth for the first time since February.

Markets, however, were also digesting Chinese President Xi Jinping’s reiteration of the country's zero Covid-19 policy, while influential central bankers at a European Central Bank forum overnight had reiterated concerns over persistent inflation.

US Federal Reserve chair Jerome Powell effectively endorsed current market pricing, signalling that another 75-basis-point hike will be on the table for discussion when policymakers meet again in late July, said National Australia Bank currency strategist Rodrigo Catril in a note.

In morning trade, the Shanghai Composite was up 1.3%, Japan’s Nikkei was down 1.4%, while the Hang Seng was flat.

Tencent, of particular relevance to the JSE due to the shareholding of the Naspers stable, was down 1.64%.

Gold was little changed at $1,816.97/oz, while platinum was unchanged at $918. Brent crude had added 0.36% to $116.06 a barrel.

The rand was 0.25% weaker at R16.22/$.

The local corporate calendar is sparse on Thursday, though there is quite a bit of economic data, including private sector credit extension numbers and balance of trade figures for May.

The release that is likely to be most closely watched by economists is producer inflation numbers for May. Expectations are that there was an acceleration to 14.1% year on year in May, from 13.1% in the prior month.

gernetzkyk@businesslive.co.za

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