JSE faces mixed Asian markets on Friday ahead of US jobs data

The JSE faces mixed and somewhat subdued Asian markets on Friday morning, with all eyes on US nonfarm payrolls numbers later.

The data is a key gauge of the health of the US economy, and comes amid uncertainty over the future of monetary policy support, as the global economic recovery gains momentum and inflation accelerates.

Nonfarm payroll data is due at 2.30pm SA time on Friday. The consensus is for the US to have added 650,000 jobs in May, while the unemployment rate is expected to have fallen from 6.1% to 5.9% and average hourly wages to have risen by 0.2%.

The US Federal Reserve has pointed to a need for a labour market recovery recently when signalling to the market it expects to keep interest rates low for a prolonged period, but there have been concerns that the threat of inflation has been underestimated.

Strong US data releases overnight sparked a bit of volatility in markets, said National Australia Bank analyst Rodrigo Catril in a note. 

ADP’s private payroll report for May showed jobless claims were better than expected, increasing the prospect for a solid non-farm payrolls print, alongside the chances of a sooner rather than later Fed tapering talk, said Catril. He added that the ADP numbers have a mixed record as predictors for the more closely watched nonfarm payrolls.

In morning trade the Hang Seng and Shanghai Composite were both up 0.14%, while Japan’s Nikkei had lost 0.39%.

Tencent, which can give direction to the local market through its largest single shareholder, the Naspers stable, had fallen 0.65%.

Gold was flat at $1,869.70/oz while platinum was 0.73% lower at $1,150/oz. Brent crude had dropped 0.24% to $71.21 a barrel.

The rand was unchanged at R13.62/$.

There is little on the local corporate or economic calendar on Friday, and focus is likely to offshore.

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