JSE faces subdued Asian session on Tuesday as investors eye Fed minutes

The JSE start on Tuesday faces a subdued Asian session, with investors seeking fresh catalysts, likely in the form of US Federal Reserve minutes on Wednesday.

Investors will scrutinise the minutes for signs that Fed officials are turning less hawkish given the recent easing of inflationary pressures.

US consumer inflation eased to 8.5% in July, but this is still more than four times the Fed’s 2% target, and some policymakers have indicated further hikes are likely to be necessary.

Sentiment was under some pressure on Monday following weak Chinese data for July, with the world’s second-largest economy still trying to recover from lockdown restrictions.

A surprise rate cut in China helped support the dollar, TreasuryOne analysts said in a note, and the dollar could remain on the front foot ahead of the minutes, with the rand pushing towards R16.50/$ in the meantime.

In morning trade, the Hang Seng and Japan’s Nikkei were flat, while the Shanghai Composite was up 0.24%.

Tencent, influential to the JSE due to Naspers, fell 0.4%.

Gold was up 0.13% to $1,781.20/oz, while platinum was flat at $932. Brent crude was up 0.67% to $94.19 a barrel.

The rand was flat at R16.41/$.

The local corporate and economic calendars are bare on Tuesday.

gernetzkyk@businesslive.co.za