The JSE was weaker on Tuesday morning, along with its global peers, as investors mulled new policy adjustments in China.
Earlier on Tuesday, Bloomberg reported that China was poised to pursue an economic growth target of about 5% in 2024 and would address issues such as industrial overcapacity and extravagant local government expenditure.
China also aims to reduce its budget deficit to 3% of economic output from the revised figure of 3.8% recorded in 2023.
“Despite mirroring last year’s growth target, achieving this goal will necessitate a more robust government stimulus,” said RMB analysts. “Nevertheless, Chinese equities experienced a dip in their opening performance, with investors eagerly anticipating further insights into the upcoming policy announcements.”
Inflation and the outlook on interest rates remain the dominant theme for markets for some time, with investors looking for clues on when the Fed could start cutting interest rates.
On the data front this week, US ADP Employment Survey and January job openings are due to be released on Wednesday, while nonfarm payroll data for is due on Friday. The data will provide further insight into the labour market and the strength of the world’s biggest economy.
Investors will also hear from Federal Reserve chair Jerome Powell when he delivers the monetary policy updates to the House of Representatives on Wednesday and to the Senate on Thursday. Investors will look for any clues on the future direction of interest rates.
“With much of the same thing in the market, focus is on later this week with Powell’s address to Congress and the nonfarm payrolls data,” said TreasuryONE currency strategist Andre Cilliers.
At 10.25am, the JSE all share lost 0.58% to 72,212.63 points and the top 40 0.71%. Precious metals were up 2.3%, food producers 0.2% and SA listed property 0.15%. Industrial metals had lost 1.85%, industrials 1.03%, retailers 0.57%, financials 0.32%, banks 0.25% and resources 0.17%.
At the same time in Europe, France’s CAC 40 was down 0.14% and Germany’s DAX 0.23%.
Earlier in Asia, the Shanghai Composite gained 0.28%, while Hong Kong’s Hang Seng lost 2.66% and Japan’s Nikkei was little changed.
At 10.14am, the rand had weakened 0.17% to R19.0345/$ and 0.19% to R24.1247/£, while it was little changed at R20.647/€. The euro was hardly changed at $1.0847.
Gold gained 0.36% to $2,121.53/oz, while platinum was unchanged at $895.83/oz. Brent crude was little changed at $82.59 a barrel.
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