Fear of Covid-19 resurgence could put JSE under pressure
The JSE could take its lead from Asian markets and weaken on Wednesday morning, amid the concern that the Covid-19 pandemic will take far longer to resolve than previously thought.
Statements made by Anthony Fauci, the top US infectious disease expert, warning of a resurgence of the virus should economies return to normal too quickly, capped emerging market gains following a steep rally during trade on Tuesday, Peregrine Treasury Solutions executive director Bianca Botes said in a note.
In morning trade, Asian markets were weaker, with Japan’s Nikkei down 0.59% and the Shanghai Composite losing 0.19%.
Tencent, which influences the JSE via Naspers, had risen 1%, and could boost the local bourse, however.
The rand was 0.3% firmer at R18.37/$.
Gold was flat at $1,702.60/oz while platinum had risen 1.31% to $763.20. Brent crude was 0.2% higher at $29.28 a barrel.
Global focus on Wednesday is on a speech by US Federal Reserve chair Jerome Powell later, amid market speculation of further decreases in interest rates in the world’s largest economy.
The market has been partially pricing in negative interest rates in the US, but Powell is likely to downplay the need for this level of cuts, echoing views shared by other policymakers in the past 48 hours, said BK Asset Management MD for foreign exchange strategy Kathy Lien in a note.
Vehicle tracking group Cartrack is expected to report a rise in profit for its year to end-February later, amid strong subscription growth.
Source: businesslive.co.za
