JSE could slide further in line with global peers

The JSE could suffer losses for the second consecutive day on Thursday, given the decidedly weak trading picture in Asia.

Industrial heavyweight Naspers could trade weaker after China’s authorities reportedly instructed Tencent and other gaming companies to enforce compliance with new regulations, which limit the amount of time children can play online games. As a result, Tencent shares fell about 4%.

Naspers has a 29% stake in Tencent, which it holds via its global internet arm, Prosus.

Elsewhere, commodity prices showed signs of stability after falling sharply on Wednesday amid creeping concerns about the sustainability of global growth, sparked by last week’s disappointing US nonfarm payrolls report.

The spot price of palladium slipped 0.20% to $2,242.89oz, after tumbling 5% on Wednesday, which was its biggest one-day fall since mid-July.

Commodity prices have been steadily sliding since peaking in the first half of 2021, though some analysts argue the dip is of a temporary nature because mining companies were not investing in new capacity that will bring additional supplies.

The rand, which tends to weaken sharply when investors are risk averse, was relatively resilient against the dollar. SA’s currency shed 0.14% to R14.20/$ in early trade, which was just below its five-week high against the greenback.

The current bout of the rand’s relative strength is mostly tied to a weaker dollar, after the US created fewer jobs than expected in August, raising concerns that the highly transmissible Delta Covid-19 variant may be starting to bite.

US Federal Reserve chair Jerome Powell has said the Fed would monitor the incoming data before scaling back its multibillion-dollar bond purchase programme, which has helped nurse the world economy back to a measure of health.