JSE faces mixed and subdued Asian markets on Wednesday as data takes focus

The JSE faces mixed and subdued Asian markets on Wednesday morning, with traders grappling with some disappointing data and waiting for further key economic releases this week.

North Asian powerhouses Japan, South Korea and China have all released data this morning, which erred on the side of slightly disappointing, said Oanda senior market analyst Jeffrey Halley in a note.

Japan’s industrial index fell by a higher than expected 5.9% month on month for May, while South Korean industrial production also underperformed, falling 0.7% from April. Halley added that as Wednesday was month end, rebalancing activity was adding to the apathy.

Markets will also be watching data releases coming up in the rest of the week, notably US nonfarm payrolls on Friday.

The JSE will need to gain more than 2% on Wednesday to have had a positive June, but has still risen 12% in the year to date.

In morning trade on Wednesday, the Shanghai Composite was up 0.24%, while the Hang Seng was down 0.16% and Japan’s Nikkei was little changed.

Tencent, which gives direction to the JSE via the Naspers stable, was flat.

Gold was unchanged at $1,760.01/oz while platinum had fallen 0.19% to $1,067.54/oz. Brent crude was unchanged at $74.62 a barrel.

The rand was little changed at R14.32/$, having fallen almost 0.5% on Tuesday.

SA’s trade balance data for May is due later, with recent surpluses a key factor in underpinning the rand so far in 2021. Buoyant commodity prices have helped with the value of exports recently, with economists also citing generally improving global demand from hard lockdowns in 2020.

Services group CSG is due to report its results for the year to end-March later, saying in a recent trading update it had returned to headline profit due to restructuring and cost-cutting efforts, but had also benefited from governmental support programmes.

Delta Property, which has recently suffered reputational damage after a forensic report uncovered alleged fraud under previous management, is due to release its results for the year to end-February later. Delta, whose current liabilities exceeded its assets by R4.17bn in the six months to end-August, has been grappling with allegations of fraud against former management and has recently written down its assets.

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