JSE could open slightly up on Tuesday, with slew of company results due

The JSE could open slightly higher on Tuesday as local stocks, including groceries giant Shoprite, report full-year results.

Investor appetite for risk was given a small boost overnight on reports that the US will give customers that do business with Huawei another 90-day reprieve before restrictions against the Chinese company kick in.

However, the boost to risk sentiment was curbed by the US government’s addition of another 46 Huawei affiliate companies to its blacklist. 

After the S&P 500 Index closed 1.2% up overnight, analysts at Singapore’s OCBC Bank said “Asian markets may extend gains today amid the olive branch for Huawei”. 

Hong Kong’s Hang Seng Index was flat at the lunch break on Tuesday, while the Shanghai Composite also treaded water. But Japan’s Nikkei 225 rose 0.5% and markets in Korea and Singapore also gained ground.

Australia’s main benchmark climbed 1% as the country’s central bank said it would cut interest rates if evidence showed this was needed.

WeChat-owner Tencent, which influences the direction of the JSE via major shareholder Naspers, was 0.5% up in Hong Kong.

JSE-heavyweight BHP Group was 0.6% down in Australia after the mining company reported annual profit and dividend growth that fell slightly short of expectations.

Meanwhile, Shoprite is due to report annual results on Tuesday.

Africa’s largest food retailer said in late July sales from its domestic supermarket business rebounded in the second half. The recovery meant group turnover for the full year rose 3.2% to R150.6bn.

However, the owner of chains including Checkers and OK Furniture said annual earnings declined by up to a fifth because of trading losses in the rest of Africa and higher costs in SA.

Harmony Gold will also publish full-year numbers. The miner said earlier in August its headline earnings per share in the year ended June rose 12%-32%, though this excluded impairments charges.

KAP Industrial is due to report financial results for the year to end-June. The group has warned that headline earnings per share fell 25%-31% partly because of a BEE transaction.

Aveng, which has been offloading assets to cut debt in the face of a tough construction market, is also expected to publish full-year results.

The SA Reserve Bank is scheduled to publish a business-cycle-indicators report.

The rand, which weakened through the day on Monday as the dollar rallied, recovered some of those losses on Tuesday morning. The local currency was trading at R15.42/$, R18.71/£ and R17.09/€.

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