JSE set to rally as Tencent rises and China aims to end tech crackdown
The reopening of the world’s second-largest economy three years after the start of the Covid-19 pandemic is also boosting local markets
09 January 2023 - 08:20
by Nico Gous
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The JSE is set to be lifted by green screens from Asia and Tencent, which influences the JSE via Naspers and Prosus, trading higher, as the Chinese government indicated it could end its crackdown on the domestic tech sector.
In Asian markets, the Hang Seng in Hong Kong gained 1.60% and the Shanghai composite in mainland China 0.53%. Markets are closed in Japan on Monday because of a public holiday. Tencent edged up 2.63% on Monday morning.
The reopening of China three years after the start of the Covid-19 pandemic is boosting local markets and the domestic economic outlook.
Adding to this positive sentiment, the People’s Bank of China party secretary Guo Shuqing said in an interview that the growth of the world’s second-largest economy will quickly return to “normal” as the central bank provides support to local households and businesses.
Chinese tech stocks were also boosted by comments by Guo that the crackdown on the sector that hammered Naspers via its stake in Tencent was ending.
The crackdown on tech companies scuttled the initial public offering of the Ant Group, founded by Jack Ma, in 2020 that would have been one of the largest in the world.
Hong Kong and China resumed quarantine-free travel at the weekend after ending its zero-Covid-19 policy in which its borders were closed for the past three years.
Added jobs
In local markets, the JSE rose the most in a month on Friday, firming with its global peers, after the latest US jobs report showed employment was slightly stronger than expected.
The December nonfarm payrolls (NFP) report showed the US economy added 223,000 jobs, slightly higher than the market expectation of 200,000 jobs, but lower than November’s 256,000 payrolls.
US markets closed with green screens on Friday as the Nasdaq jumped 2.56%, the S&P 500 2.28% and the Dow Jones 2.13%.
The JSE all share gained 1.88% to 76,858 points — having reached its best levels since March in intraday trade at 77,069 points — and the top 40 added 2.04%, boosted by industrial metals (up 4.78%), resources (4.27%), precious metals (4.14%), industrials (1.65%) and food producers (0.8%).
In commodities, the price of Brent crude, gold and platinum rose. Brent was 1.33% higher at $79.51 a barrel, gold up 0.69% to $1,877.07/oz and platinum rose 0.53% to $1,094.30.
The rand strengthened 0.38% against the dollar, trading at R17.06.
The corporate calendar is bare for Monday with no announcements expected.
The SA Reserve Bank will publish the latest foreign exchange reserves at 8am, with an increase to $60.2bn expected.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
JSE set to rally as Tencent rises and China aims to end tech crackdown
The reopening of the world’s second-largest economy three years after the start of the Covid-19 pandemic is also boosting local markets
The JSE is set to be lifted by green screens from Asia and Tencent, which influences the JSE via Naspers and Prosus, trading higher, as the Chinese government indicated it could end its crackdown on the domestic tech sector.
In Asian markets, the Hang Seng in Hong Kong gained 1.60% and the Shanghai composite in mainland China 0.53%. Markets are closed in Japan on Monday because of a public holiday. Tencent edged up 2.63% on Monday morning.
The reopening of China three years after the start of the Covid-19 pandemic is boosting local markets and the domestic economic outlook.
Adding to this positive sentiment, the People’s Bank of China party secretary Guo Shuqing said in an interview that the growth of the world’s second-largest economy will quickly return to “normal” as the central bank provides support to local households and businesses.
Chinese tech stocks were also boosted by comments by Guo that the crackdown on the sector that hammered Naspers via its stake in Tencent was ending.
The crackdown on tech companies scuttled the initial public offering of the Ant Group, founded by Jack Ma, in 2020 that would have been one of the largest in the world.
Hong Kong and China resumed quarantine-free travel at the weekend after ending its zero-Covid-19 policy in which its borders were closed for the past three years.
Added jobs
In local markets, the JSE rose the most in a month on Friday, firming with its global peers, after the latest US jobs report showed employment was slightly stronger than expected.
The December nonfarm payrolls (NFP) report showed the US economy added 223,000 jobs, slightly higher than the market expectation of 200,000 jobs, but lower than November’s 256,000 payrolls.
US markets closed with green screens on Friday as the Nasdaq jumped 2.56%, the S&P 500 2.28% and the Dow Jones 2.13%.
The JSE all share gained 1.88% to 76,858 points — having reached its best levels since March in intraday trade at 77,069 points — and the top 40 added 2.04%, boosted by industrial metals (up 4.78%), resources (4.27%), precious metals (4.14%), industrials (1.65%) and food producers (0.8%).
In commodities, the price of Brent crude, gold and platinum rose. Brent was 1.33% higher at $79.51 a barrel, gold up 0.69% to $1,877.07/oz and platinum rose 0.53% to $1,094.30.
The rand strengthened 0.38% against the dollar, trading at R17.06.
The corporate calendar is bare for Monday with no announcements expected.
The SA Reserve Bank will publish the latest foreign exchange reserves at 8am, with an increase to $60.2bn expected.
gousn@businesslive.co.za
MARKET WRAP: JSE firms the most in a month on US jobs report
Eurozone inflation slows in December, but price pressure rising
Global stocks tepid ahead of US jobs data
SA bonds ready for resurrection after a year of horror
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