JSE faces mixed Asian markets on Monday as China battles Covid-19 wave

The JSE looks set to contend with mixed Asian markets on Monday morning, with Chinese markets under pressure after a surge in Covid-19 infections at the weekend.

China’s case numbers have more than tripled, but the country has adopted a more flexible approach to the pandemic, moving away from a zero tolerance approach and strict lockdowns.

“The spike in numbers is now a big test and it remains to be seen if officials will tolerate large outbreaks or whether drastic and long-lasting lockdown measures are reintroduced with the latter potentially having a hindering affect on China’s domestic economy with supply constraint issues globally,” said National Australia Bank analyst Rodrigo Catril in a note.

Focus is also on the Ukraine, with markets lifted a little by peace-talks hopes on Monday, though Ukrainian officials later poured cold water on this.

In morning trade the Hang Seng slumped 3.9% while the Shanghai composite was 1.3% lower. Japan’s Nikkei gained 0.7% and Australia’s all ordinaries index 0.9%.

Tencent, which gives direction to the JSE via the Naspers stable, lost 4.6%.

Gold was down 0.65% to $1,975.13/oz while platinum lost 1.63% to $1,059.50. Brent crude was 1.32% higher at $110.46 a barrel.

The rand was 0.21% weaker at R15.10/$.

Absa is due to report its results for the year to end-December later, expecting headline earnings per share to as much as triple. The bank has indicated that it has seen improved loan growth, while credit impairments have improved significantly, off 2020’s high base.

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Source: businesslive.co.za