JSE faces lower Asian markets after US sell-off

It is red across the board from Asia on Friday morning as markets tracked Wall Street which closed lower overnight, so the JSE is opening to investors still digesting higher than expected US inflation data.

Japan’s Nikkei was down 1.02%, the Shanghai Composite in mainland China traded 0.96% lower and the Hang Seng in Hong dipped by 0.42%.

The Nikkei tracked US markets as investors try to figure out their next move amid concerns about a possible recession.

US inflation data coming in hotter than expected earlier this week, triggering a sell-off. While US headline inflation slowed to 8.3% year on year in August from 8.5% in July, core inflation — which excludes volatile energy and food and is the Federal Reserve’s preferred measure of prices — accelerated to 6.3% from 5.9%.

The Shanghai Composite was down despite a series of positive data from the world’s second largest economy, including urban unemployment reaching its lowest levels since January, year-on-year retail trade sales beating expectations, and industrial production rising.

But it was not all good news as new home prices fell the most in seven years in part because of the country’s strict zero-Covid policy, ongoing lockdowns and a debt crisis among developers.

The Hang Seng slipped as investors remain concerned about a global slowdown amid the possibility of higher interest rates.

Tencent, which influences the JSE via Naspers, is down 0.67%.

In local markets, the JSE posted a third straight day of losses on Thursday in another volatile session, suggesting that investors are braced for further uncertainty amid high inflation and rising interest rates.

The all share lost 0.58% to close at 67,568.26 points, dragged lower mainly by big mining shares that tumbled after a further drop in commodity prices on the back of a strong dollar.

It was a mixed bag in terms of commodities with an uptick in Brent crude, gold being flat and platinum declining.

Brent crude was up 0.2% to $91.02 a barrel. Gold was even at $1,663.91/oz. Platinum was down 0.28% to $902.

The dollar was even against the rand at R17.57.

The corporate and economic calendar is bare for Friday with little expected.

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Source: businesslive.co.za