JSE follows declining Asian markets

The JSE fell on Thursday morning, with Asian markets remaining under pressure, as the coronavirus outbreak intensified and fuelled additional concern over the potential economic fallout.

The World Health Organisation (WHO) is expected to meet for an emergency meeting on Thursday to consider its next steps for containing the virus. Markets will be closely watching the outcome of this meeting.

Asian stocks were under pressure as economists reconsidered China’s growth prospects for the first quarter. Millions of people in the world’s second-largest economy are already facing travel restrictions.

“Asian markets have fallen to seven-week lows, as concerns over the coronavirus elevate once again,” said Rand Merchant Bank analyst Siobhan Redford.

The WHO has called a meeting of its emergency committee on Thursday to discuss whether they need to issue a global alert over the virus as the death toll continued to rise sharply, now standing at 170 people, said Redford.

“Should the WHO issue such an alert, the risk-off environment that has been dominating global trade is likely to intensify”, he said.

Earlier, Hong Kong’s Hang Seng fell 2.62%. In Europe, the FTSE 100 was down 0.63%, France’s CAC 40 1.22% and Germany’s DAX 30 1.02%.

At 11.17, the JSE all share had weakened 0.29% to 56,208.4 points and the top 40 was 0.31% lower. Banks lost 0.27% and financials 0.25%. Platinum miners had gained 1.36% and gold miners 4.07%.

Gold was up 0.21% to $1,580.17/oz, while platinum was 0.8% lower to $969.78/oz. Brent crude was down 1.12% to $58.89 a barrel.

Locally, the focus is on the start of a two-day cabinet meeting, with the expectation of policy announcements.

Producer inflation data for December is due at 11.30am. Most economists expect producer inflation to have climbed back above 3% year on year in December from 2.3% year on year in November.

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