JSE could be subdued on Wednesday as market eyes ongoing risks

The JSE may take its lead from subdued Asian markets on Wednesday morning, as volumes slow due to looming holidays and as various political and economic risks persist.

The pound has come under pressure after UK Prime Minister Boris Johnson indicated he did not want an extension of the transition period past December 31 2020 — increasing the chances of a no-deal Brexit.

Fresh off the back of a commanding electoral victory, this could be a smart move by Johnson in seeking to bring the EU to the table, as he has a strong mandate and a better negotiating position, said National Australia Bank analyst Rodrigo Catril in a note.

“The move suggest [the pound’s] path in 2020 looks set to be a volatile one, a hard Brexit cannot be ruled out, but the probability of a positive Brexit resolution has also increased,” said Catril.

Markets are also waiting for further details regarding a partial trade deal reached between the US and China, while there is a strong possibility that US President Donald Trump will be impeached by the House of Representatives later on Wednesday.