The JSE was firmer amid mixed peers on Thursday morning, while the rand was weaker, with local focus on the SA Reserve Bank’s interest rate announcement.
On Wednesday, Stats SA reported that headline inflation as measured by the consumer price index (CPI) eased to 2.8% year on year in October, from 3.8% in September.
Core inflation, which excludes volatile fuel and food prices, also eased to 3.9% year on year in October from 4.1% in September.
Analysts say further easing in inflation supports the case for the SA Reserve Bank to cut interest rates by 25 basis points (bps) when the monetary policy committee (MPC) concludes its meeting on Thursday afternoon.
“Expectations of a 25bps rate cut and a dovish Reserve Bank tone could drive modest gains, barring external shocks,” TreasuryOne currency strategist Andre Cilliers said.
“Uncertainty over US president-elect Donald Trump’s potential presidency, Nato dynamics and Ukraine-Russia tensions may periodically weigh on the rand, particularly if safe-haven flows strengthen the dollar,” Cilliers said.
At 10.27am, the rand had weakened 0.33% to R18.1669/$, 0.28% to R19.1344/€ and 0.35% to R22.9621/£. The euro was 0.11% weaker at $1.053.
In the US, investors assessed Nvidia’s quarterly earnings, which surpassed expectations despite shares falling over 2% in extended trading.
Analysts’ market reaction was due to pre-release positioning and the complexity of Nvidia's long-term prospects.
According to Barclays Capital, Nvidia’s earnings report was the most highly anticipated event of 2024, surpassing even the Federal Reserve’s interest rate meetings, reported Bloomberg. This intense focus stems from Nvidia's remarkable growth — now valued at $3.6-trillion, fuelled by soaring demand for its artificial intelligence chips.
At 10.40am, the JSE all had gained 0.47% to 85,678.75 points and the top 40 was up 0.44%. Retailers had risen 4.25%, food producers 1.25%, banks 0.73%, industrials 0.68%, financials 0.62% and precious metals 0.17%. Industrial metals had lost 0.37%.
At the same time in Europe, the FTSE 100 and Germany’s DAX were little changed, while France’s CAC 40 had lost 0.18%.
Earlier in Asia, the Shanghai Composite was little changed, Hong Kong’s Hang Seng was down 0.47% and Japan’s Nikkei 0.85%.
On the commodities markets, gold gained 0.75% to $2,669.89/oz and platinum 0.1% to $960.38/oz. Brent crude was 0.93% firmer at $73.47 a barrel.
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