The JSE was firmer on Tuesday morning, with global peers mixed as investors awaited corporate earnings from top artificial intelligence (AI) company Nvidia, due later in the day.
Investors will pay close attention to Nvidia’s second-quarter results for clues of the tech and AI sectors’ overall health.
Recent disappointing results from Nvidia triggered a broader sell-off of major tech stocks, as investors offloaded shares of AI companies amid the growing expectation of a September interest rate cut by the US Federal Reserve.
In recent months, big technology stocks have fallen out of favour, despite a frenzy surrounding AI technology. However, this frenzy has propelled a select few in the sector, including Nvidia, to record highs, sparking concern that they may be overvalued.
The markets have had a rough start to the month, but investors are feeling more optimistic after Fed chair Jerome Powell hinted at a potential interest rate cut. Powell did not provide a timeline or specifics, but traders expect a rate cut of at least 25 basis points (bps) at the Fed’s September meeting.
At 10.50am, the JSE all share had gained 0.39% to 84,525.79 points and the top 40 0.47%. Industrial metals had added 1.06%, resources 0.75%, SA listed property 0.55%, precious metals 0.52%, industrials 0.4%, banks 0.33% and financials 0.14%. Food producers had lost 0.55% and retailers 0.44%.
At the same time in Europe, the FTSE 100 had gained 0.61%, France’s CAC 0.42% and Germany’s DAX 0.35%.
Earlier in Asia, the Shanghai Composite lost 0.24%, while Hong Kong’s Hang Seng added 0.42% and Japan’s Nikkei 0.47%.
This week’s economic calendar features key releases, including initial jobless claims on Thursday and July’s personal consumption expenditures (PCE) report — the Fed’s preferred measure of inflation — due on Friday.
At 10.24am, the rand had weakened 0.37% to R17.7807/$, 0.48% to R19.862/€ and 0.62% to R23.4923/£. The euro was 0.11% firmer at $1.1171.
In commodities markets, gold lost 0.22% to $2,512.1/oz, while platinum gained 0.25% to $962.75/oz. Brent crude was 0.32% weaker at $80.98 a barrel.
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