JSE could follow a sliding oil price on Tuesday

The JSE may take its lead from sliding Asian markets on Tuesday morning, with focus on the oil price, as well as on possible health problems for North Korean leader Kim Jong Un.

Reports that the North Korean leader is critically ill has injected caution into the market, due to prospect of a leadership succession in the heavily militarised country.

Focus is also on the oil price, after oil futures for May fell into negative territory on Monday, with an oversupply of oil resulting in concerns of a storage shortage. This has been compounded by the effect of the expiry of May oil futures contracts.

The fall in the oil price has had little effect on most other asset classes so far, and there is hope that easing Covid-19 restrictions and production cuts will improve the situation by June, said National Australia Bank analyst Ray Attrill in a note.

In morning trade on Tuesday the Hang Seng was down 2.29%, while the Shanghai Composite had lost 1.35%.

Tencent, of which Naspers is the largest single shareholder, had lost almost 2%.

Gold was flat at $1,690.50/oz, while platinum had given back 0.55% to $765.10.

Brent crude was down 2.46% to $25.38 a barrel, having fallen 61.50% so far in 2020.

The rand was 0.34% weaker at R18.87/$.

There is little on the local corporate and economic calendar, with global focus on the Covid-19 outbreak, the oil price, and the Korean peninsula.

Sasol’s share price could also react to the volatility in the oil price. The share price of the embattled chemicals group has fallen more than 80% so far in 2020.

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