JSE faces cautious start on Tuesday ahead of GDP release
SA’s main bourse could get off to a cautious start on Tuesday as trade tensions continue to weigh on sentiment and after a US Federal Reserve member said an interest rate cut may be on the cards.
Traders will keep a close eye on SA’s first-quarter GDP reading, which Statistics SA is due to release late on Tuesday morning.
Investec economists said last week another contraction was likely, but the longer-term outlook for SA had improved. Investec forecasts a 1.9% quarter-on-quarter contraction.
Meanwhile, on Monday, James Bullard, a member of the Federal open market committee, said an interest rate cut “may be warranted soon” to boost inflation and the economy in the face of US trade disputes with several countries. That added to concerns that trade tensions and higher tariffs could dent the global economy.
Hong Kong’s Hang Seng Index was 0.3% down on Tuesday, and the Shanghai Composite slipped 0.8%. Japan’s Nikkei 225 was flat, while Australia’s main benchmark edged 0.3% up.
Chinese technology company Tencent fell as much as 1.6% in Hong Kong, suggesting a weak opening for major shareholder and JSE-heavyweight Naspers.
On the other hand, BHP Group, the third largest constituent in the JSE’s top-40 index, was 1.4% up in Australia.
No major company results are expected in SA on Tuesday.
Data releases elsewhere include unemployment and inflation numbers in the EU, and factory orders in the US.
The rand was flat on Tuesday morning at R14.46/$, R18.30/£ and R16.26/€.
Source: businesslive.co.za
