The JSE faces mostly higher Asian markets while most traders will search for clues about what to expect next, especially in terms of interest rates, from the US Federal Reserve when chair Jerome Powell delivers a speech later on Wednesday.
The Hang Seng in Hong Kong and Shanghai composite in mainland China edged up 0.22% and 0.21%, respectively, while the Nikkei in Japan was down 0.50%. Year to date, the Hang Seng has lost 21.61%, the Shanghai composite 13.10% and the Nikkei 4.83%.
Tencent, which influences the JSE via Naspers and Prosus, shed 1.12% and remains 37.73% lower in 2022.
Investors in mainland China shrugged off the latest disappointing economic data for manufacturing and services activities as surging Covid-19 cases and restrictions weighed on the economy.
Meanwhile, traders are monitoring what Chinese government will do to tackle the record number of cases, with some hoping that the protests against the country’s zero-Covid policy may spur a faster reopening of the world’s second-largest economy.
“The activity data continues to cement the view that the Chinese economy is expected to display a distinct ‘two halves’ next year, where a brutal winter will likely continue to weaken economic data in December and the first quarter following,” SPI Asset Management managing partner Stephen Innes said in a note.
Local health officials encouraged the elderly to get vaccinated. “To the extent the low vaccination take-up amongst elderly Chinese people has been a major impediment to lifting Covid restrictions, the announcement represents another step towards eventually moving away from the zero-Covid policy,” Bank of New Zealand senior interest rates strategist Nick Smyth said in a note.
The markets in Japan were down after a mixed day in the US and new data showing industrial activity fell more than expected in October.
In local markets, the JSE all share lost 0.33% to 73,127.92 points and the top 40 eased 0.27% on Tuesday.
US markets ended with mixed screens on Tuesday. The Nasdaq retreated by 0.59% and the S&P 500 0.16%, while the Dow Jones was flat. Year to date, the Nasdaq has slid 30.63%, the S&P 500 17.49% and the Dow Jones 7.47%.
Investors are remaining cautious as they wait to hear what Powell will say at the public policy organisation Brookings Institution later on Wednesday.
The rand lost ground against the dollar, retreating 0.11% to R16.98/$. The rand has depreciated by 6.46% so far against the greenback so far in 2022.
In commodities, the price of platinum rose 0.72% to $1,008.72,/oz gold 0.43% to $1,755.45/oz and Brent crude 0.28% to $85.15 a barrel.
In corporate news, Fairvest, the owner of retail centres in rural areas and small towns, will release its annual results and infrastructure company Mahube Infrastructure its interim results.
On the economics side, FNB/Bureau of Economic Research (BER) will publish the latest building confidence index, which measures the mood of respondents in the sector.
At 2pm, the SA Revenue Service (Sars) will release data on the country’s trade balance. SA recorded a trade surplus of R19.70bn in September, well above August’s R7.2bn.
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