JSE faces mostly positive Asian markets on Wednesday as investors eye Taiwan

The JSE looks set to join mixed, though mostly positive, Asian markets on Wednesday morning, with investors still watching potential developments following a visit by US House speaker Nancy Pelosi to Taiwan.

The high-profile visit has drawn criticism from Beijing and military exercises close to Taiwanese territory, offering a threat of escalation.

“Beyond military theatre, the issue to watch once Pelosi returns to the US will be whether the White House talks tough on China ... without driving an economic fracture,” SPI Asset Management managing partner Stephen Innes said in a note. “On a related note, it would be hugely surprising if the US cuts import tariffs on China ahead of the midterms, given the Taiwan fracas.”

However, some hawkish commentary from US Federal Reserve officials shifted attention away from Taiwan, he said, adding that it is too early to tell if further 75 basis point interest rate hikes will be needed to fight inflation.

In morning trade Japan’s Nikkei and the Hang Seng were up 0.52% and the Shanghai 0.4%, while Australia’s All Ordinaries index lost 0.4%.

Tencent, which influences the JSE via the Naspers stable, gained 2.24%.

Gold was up 0.55% to $1,769.16/oz while platinum rose 1.18% to $902.30. Brent crude added 0.15% to $99.98 a barrel.

The rand was 0.41% firmer at R16.73/$.

The domestic corporate calendar is bare on Wednesday, while the S&P Global purchasing managers index for SA in July is due later, after rising to 52.5 points in June, its fastest pace in more than a year.

The index tracks business trends across private-sector activity, including mining, manufacturing, services, construction and retail based on data collected from a representative panel of about 400 companies.

gernetzkyk@businesslive.co.za