The JSE was little changed on Monday morning, with global markets mixed as investors weighed China’s underwhelming stimulus package and the US economy’s surprising resilience.
Investors were assessing China’s recently announced 6-trillion yuan ($839bn) stimulus package, which fell short of expectations. The package aims to refinance local government debt and boost growth in China’s economy.
Meanwhile, in the US, treasury yields rose due to the economy's better-than-expected resilience. The US Federal Reserve’s interest-rate cuts have helped control inflation to near the 2% target, and sustain job market growth. However, US president-elect Donald Trump’s policies, including potential tariffs, may drive inflation and national debt higher, leading economists to revise forecasts for future rate cuts, reported Bloomberg.
“While China’s debt package to ease local government debt is substantial, it fell short of investors’ hopes for more direct economic stimulus,” Citadel Global director Bianca Botes said.
“Beijing hinted at future stimulus but gave no timeline, with analysts suggesting China may be waiting to gauge US policy under president-elect Trump. This caution reflects China’s intent to preserve its options in case of further trade tensions,” added Botes.
At 10.35am, the JSE all share and the top 40 where little changed, with the former at 85,063.27 points. Retailers had gained 0.72%, SA listed property 0.51%, financials 0.17% and banks 0.11%. Precious metals had lost 1.01%, industrial metals 0.64% and resources 0.77% and food producers 0.16%.
At the same time in Europe, the FTSE 100 was up 0.8%, France’s CAC 40 1.2% and Germany’s DAX 1.21%.
Earlier in Asia, the Shanghai Composite added 0.51%, while Hong Kong’s Hang Seng lost 1.64% and Japan’s Nikkei was little changed.
At 10.27am, the rand had weakened 0.22% to R17.6281/$ and 0.1% to R22.7208/£, while it had firmed 0.15% to R18.8261/€. The euro was 0.34% weaker at $1.0682.
In the commodities markets, gold had lost 0.53% to $2,669.86/oz, while platinum gained 1.57% to $984.23/oz. Brent crude was 0.16% firmer at $73.98 a barrel.
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