The JSE was weaker on Monday morning, while its global peers were mixed as investors digested the US labour market remaining strong, and what it would mean for the Federal Reserve interest-rate outlook.
US data showed nonfarm payrolls grew much more than expected in May, rising 339,000 vs economists’ expectations of a 190,000 increase.
Recent strong job reports have pressured the financial markets on the notion that the resilient labour market will keep the US Federal Reserve in hiking mode.
However, Friday’s data also showed average hourly earnings rose less than economists expected year over year, while the unemployment rate was higher than anticipated.
“Friday’s non-farm payroll numbers showing that the US has added significantly more jobs than expected will bolster the case for a hawkish Fed at June’s federal open market committee [FOMC] meeting,” said Citadel Global director Bianca Botes.
At 10.20am, the JSE all share had lost 0.54% to 76,710.16 points and the top 40 0.64%. Precious metals had lost 1.08%, resources 0.65%, industrials 0.62%, industrial metals 0.52%, banks 0.33% and financials 0.26%.
At the same time in Europe, Germany’s DAX had added 0.1%, while France’s CAC 40 had lost 0.1%.
Earlier in Asia, the Shanghai Composite was little changed, while Hong Kong’s Hang Seng firmed 0.74% and Japan’s Nikkei 2.2%.
The rand extended the previous session’s gains, but still remains under pressure.
“Markets, looking towards the interest-rate decisions, have kept the dollar near a two-month high, which is weighing on riskier market currencies,” said Botes
At 10.10am, the rand had strengthened 0.19% to R19.4606/$, 0.35% to R20.8049/€ and 0.43% to R24.1366/£. The euro was 0.13% weaker at $1.0692.
Gold lost 0.25% to $1,942.41/oz, while platinum added 0.71% to $1,008.83/oz. Brent crude rose 2.06% to $77.77 a barrel.
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